Ethereum quiet at $3,800: Calm before the ETF boost?

• Analyst expects further ETH bullish momentum as options volumes remain high
• However, divergent views on non-staking ETH ETF demand persisted. 

After reversing all the losses made between March and May, Ethereum [ETH] has been quiet on the charts, swinging around $3,800 for about two weeks now. 

Was it the calm before a spot ETH ETF-induced storm on the price charts? Maybe. 

Ethereum’s bullish expectations

According to Singapore-based crypto trading firm QCP Capital, ETH’s options market volume was higher than BTC’s, underscoring further bullish expectations for the king of altcoins.

“This bullishness is likely to continue as the market waits for the ETH spot ETF to usher in new demand. The options market certainly reflects this, with ETH vols still trading 15% over BTC vols.”

Additionally, an X user (formerly Twitter), MacroCRG, established that ETH trended higher amidst a weakening US Dollar Index (DXY). Both Bitcoin and ETH are inversely correlated. A weakening DXY always coincides with a rally for ETH and BTC. 

ETH ETF demand factor

Most market observers eyed massive demand for ETH from spot ETH ETFs. However, there have been divergent views on this, especially after spot ETH ETFs removed the staking option. 

One of the users mentioned that going for a non-staking spot-ETH ETF had ‘an opportunity cost.’

“A non-staking ETH ETF has a distinct opportunity cost in native supply adjusted terms that the BTC ETF does not.’

However, on his part, David Hoffman of Bankless rebutted the claim and stated, 

‘I think we’re overindexing on how much TradFi cares about this, versus DGAFing and wanting exposure. IMO, the addition of staking will simply be a second-wind for flows.’ 

In fact, one of the potential issuers, ARK Invest, dropped from the ETH ETF party, citing that, 

“We will continue evaluating efficient ways to provide our investors with exposure to this innovative technology in a way that unlocks its full benefit.”

However, Galaxy Digital’s Mike Novogratz recently projected that staking could be allowed within two years after the ETH ETF launch. If the projection plays out, we could see the ‘second wind for flows’ by then. 

That said, a weakening DXY could boost ETH’s short-term price action before spot ETH ETFs launch. However, how demand plays out post-ETH ETFs remains to be seen.