Ether ETF Speculation Could Weigh on SOL, Wider Altcoin Market
Traders will not want to be short ETH while going through an ETF approval, one observer said.
- Renewed hopes of an ether ETF debut in the U.S. is likely to see investors take money out of SOL and other alternative cryptocurrencies to invest into ETH.
- Approval of a spot ether ETF is likely to broaden mainstream demand for crypto in the long run.
The crypto bull run that began last October has been characterized by Ethereum's ether
That, however, could change in the coming weeks, with ether overtaking the others on renewed hopes that a spot ether exchange-traded fund (ETF) will be approved in the U.S., opening the doors to a deluge of institutional money.
Late Monday, CoinDesk reported that the U.S. Securities and Exchange Commission (SEC) had asked firms looking to list and trade ether ETFs to update and refile documents necessary to secure regulatory approval. Around the same time, Bloomberg's ETF analysts raised the probability of the approval to 75% from 25%.
"ETH has been a de-facto funding token of this bull cycle, similar to the low-yielding Japanese yen in the currency market. With renewed hopes of a spot ETH ETF, traders would want to square off their ETH shorts vs SOL and other tokens," Ilan Solot, co-head of digital assets at Marex Solutions, said in an interview. "The unwinding of shorts will happen over time, ensuring ether outperformance in the near-term."
Though approval is not guaranteed , the signs of progress contrast starkly with the pessimism early this year that saw investors prefer BTC, SOL and others over the ether.
Nearly a dozen spot bitcoin ETFs began trading in the U.S. mid-January, putting the leading cryptocurrency at the forefront of mainstream institutional adoption. Furthermore, in the first quarter, investors increasingly flocked to cheaper and faster programmable blockchains like Solana, strengthening the bullish case for their native tokens.
That meant investors had an incentive to sell ether and buy SOL, BTC and other coins much as in forex markets investors sold the yen in favor of relatively high-yielding currencies like the dollar, euro and British pound. The SOL-ETH ratio has risen by 287% since October, and the ETH-BTC ratio has declined by 16.6%, according to TradingView.
That's no longer the case. The potential introduction of an ether ETF would put the cryptocurrency in a completely different category from SOL and other tokens. As such, the ETF speculation could see investors rotate money out of alternative cryptocurrencies and into ether. The token has rallied more than SOL, BTC and others in the past 24 hours.
"This ETH move might be just getting started," Solot said. "There could be waves of short covering as nobody would want to be short ETH going through an ETF approval."
Long-term bias unchanged
Derivatives market activity suggests investors are yet to price in ether leadership over the long term.
"The derivatives market believes that the current jump in ether is more likely caused by speculative sentiment. The front end of the ETH/BTC forward exchange rate term structure has seen some contango, but the back end remains in backwardation. This implies that investors have not changed their views on the long-term performance of ETH compared to BTC," said Griffin Ardern, head of options trading and research at crypto financial platform BloFin, in a Telegram chat.
That's consistent with analysts' view that ether ETFs will not hurt demand for bitcoin ETFs over the long run.
"I don't see spot ETH ETFs draining funds from BTC ETFs," Noelle Acheson, author of the popular Crypto Is Macro Now newsletter, told CoinDesk. "There may be some churn, but approval of the spot ETH ETFs is more likely to broaden the mainstream demand rather than channel it, with many investors seeing the ETH ETFs as a diversifier of the crypto portion of portfolios."
Acheson added that the jump in overall crypto interest should continue to boost both, especially as investors become familiar with the different narratives and likely use cases.
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Exchange Review - March 2025

CoinDesk Data's monthly Exchange Review captures the key developments within the cryptocurrency exchange market. The report includes analyses that relate to exchange volumes, crypto derivatives trading, market segmentation by fees, fiat trading, and more.
需要了解的:
Trading activity softened in March as market uncertainty grew amid escalating tariff tensions between the U.S. and global trading partners. Centralized exchanges recorded their lowest combined trading volume since October, declining 6.24% to $6.79tn. This marked the third consecutive monthly decline across both market segments, with spot trading volume falling 14.1% to $1.98tn and derivatives trading slipping 2.56% to $4.81tn.
- Trading Volumes Decline for Third Consecutive Month: Combined spot and derivatives trading volume on centralized exchanges fell by 6.24% to $6.79tn in March 2025, reaching the lowest level since October. Both spot and derivatives markets recorded their third consecutive monthly decline, falling 14.1% and 2.56% to $1.98tn and $4.81tn respectively.
- Institutional Crypto Trading Volume on CME Falls 23.5%: In March, total derivatives trading volume on the CME exchange fell by 23.5% to $175bn, the lowest monthly volume since October 2024. CME's market share among derivatives exchanges dropped from 4.63% to 3.64%, suggesting declining institutional interest amid current macroeconomic conditions.
- Bybit Spot Market Share Slides in March: Spot trading volume on Bybit fell by 52.1% to $81.1bn in March, coinciding with decreased trading activity following the hack of the exchange's cold wallets in February. Bybit's spot market share dropped from 7.35% to 4.10%, its lowest since July 2023.
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What to know:
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