Economist and crypto trader Alex Krüger recently shared his base case scenario for the crypto market, offering incisive predictions about Bitcoin (CRYPTO: BTC) and Ethereum's (CRYPTO: ETH) future price trajectories.
What Happened: Krüger's base case scenario is "Bitcoin much higher into year-end, with Ethereum underperforming due to a possible ETF rejection. He also predicts that the forthcoming U.S. elections could change the landscape dramatically and a change in regulatory leadership, potentially leading to Gary Gensler's removal, would pave the way for an Ethereum ETF approval in 2025. "Ethereum overperforming from the U.S. elections onwards," he suggests.
My base case scenario has been
— Alex Krüger (@krugermacro) May 21, 2024
– Bitcoin much higher into year end
– Ethereum underperforming due to an ETF rejection
– Ethereum overperformimg from the US elections onwards, as elections would lead to a Gensler removal and subsequent ETF approval in 2025
An ETH ETF approval... pic.twitter.com/8rEAeYHMbK
Yet, should an Ethereum ETF approval come as early as this week, Krüger argues that it would accelerate everything significantly. Commenting on the immediate reaction of Ethereum, he states "Today's move was just the market repositioning and shorts closing."
An unexpected ETF approval could unleash substantial inflows, driving Ethereum to new all-time highs. "Do not fade an approval. It is not even remotely priced in," Krüger warns. However, ETH/BTC continues to remain in red year-to-date, presenting an opportunity for considerable upward momentum.
Also Read: Ethereum Prints 'Banana Zone Candle' With Largest One-Day Market Cap Gain At $71B Following Potential ETF Approval
Why It Matters: The potential for an ETF rejection is not dismissed lightly. Krüger acknowledges the significant downside risk, stating, "If the ETF gets rejected, we are in for a world of pain." Therefore, he advises traders to stay vigilant and keep alerts active during U.S. trading hours until the decision on May 23.
Bloomberg ETF analysts updated their approval chances to 75% on Monday.
In conclusion, Alex Krüger's analysis highlights the dramatic influence an Ethereum ETF decision could have on the market. Whether it comes this week or post-election, the approval could catalyze a major bullish run for Ethereum. However, traders should remain cautious and prepared for the potential fallout of a rejection.
What's Next: The influence of Ethereum as an institutional asset class is expected to be thoroughly explored at Benzinga's upcoming Future of Digital Assets event on Nov. 19.
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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