- Ethereum poised to have a positive quarter ahead according to new research.
- AI tokens dominated in the social space and performed positively YTD.
Ethereum [ETH] and AI tokens have had a positive run over the last few months.
Interestingly, Grayscale Research believes the upcoming quarter will be heavily influenced by the recent approval of spot Ether exchange-traded products (ETPs) in the U.S. market.
This is a significant development as the Securities and Exchange Commission (SEC) greenlit Form 19b-4 filings in late May, allowing several issuers to list these Ether ETPs on U.S. exchanges.
ETPs to help ETH
Grayscale’s market analysis assumes ETPs will begin trading in Q3 2024.
Similar to the successful launch of spot Bitcoin ETPs in January, Grayscale Research anticipates these Ether products will attract significant net inflows, albeit likely to a lesser extent than their Bitcoin counterparts.
This could potentially translate to price support for Ethereum itself and tokens within its ecosystem.
The launch of spot Ether ETPs is expected to bring additional focus to the unique features of the Ethereum network. Unlike other blockchains, Ethereum utilizes a modular design approach, where different infrastructure components work together to optimize user experience and reduce costs.
Furthermore, Ethereum boasts the largest decentralized finance (DeFi) ecosystem in the crypto space and is a hub for tokenization projects.
Increased interest and adoption of Ethereum fueled by ETP approval could lead to rising activity and valuation support for specific Layer 2 tokens such as Mantle, prominent DeFi protocols like Uniswap, Maker, Aave, and other crucial assets within the Ethereum network such as Lido, a staking protocol.
One key factor that could showcase how interest in Ethereum has been growing could be how ETH’s price has remained resilient while BTC’s prices have plummeted.
Despite both ETH and BTC being heavily correlated, recent market drawdowns haven’t impacted ETH as harshly as BTC.
Source: Santiment
While spot Ether ETPs represent a major development, Grayscale Research anticipates other ongoing market themes to remain relevant in the coming quarter.
A key area of focus will be the potential for blockchain technology to intersect with the field of Artificial Intelligence (AI).
Are AI tokens doing good?
According to recent data, AI tokens had the largest amount of dominance when it came to the social media landscape.
Source: Grayscale Research
Moreover, AI based tokens such as RNDR, TAO and FET, outperformed the overall crypto sectors market index as well in terms of year to date price performance. If the hype around AI tokens continues, it could yield positive results for holders.
Source: Grayscale
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