Ethereum, the world's second-largest cryptocurrency, fell significantly following a stock market rout that has rattled global markets.
Ethereum fell about 6%, its biggest drop in three weeks, trading at $3,170 at 11:13 a.m. Singapore time on Thursday. Meanwhile, bitcoin, the world’s largest cryptocurrency, fell about 3% to $64,110.
Deteriorating investor sentiment
A plunge in big tech stocks sent U.S. stocks into their worst day since 2022 on Wednesday as the artificial intelligence craze began to fade, weighing on investor sentiment.
“After a bad night for US stocks, cryptocurrencies, like most asset classes, appear to be being affected by the spread of negative sentiment among investors,” said Benjamin Sellermager, co-chief investment officer at Magnet Capital.
Ethereum ETFs Launched
Last Tuesday, eight Ethereum ETFs launched in the United States, and the largest Ethereum fund, the Grayscale Ethereum Trust, which launched six years ago and has nearly $8 billion in assets, converted from its closed-end form into an ETF.
But Grayscale’s conversion to its new trading format has made it easier for those looking to make a quick profit by taking advantage of the cryptocurrency’s price differences in different markets to exit. The fund has already exited $811 million worth of assets since its restructuring, according to data compiled by Bloomberg. That has led to some caution in the market, even as other ethereum funds have attracted investment.
For her part, Noelle Atcheston, author of the Crypto Is Macro Now newsletter, wrote that some selling pressure may appear after the launch of Ethereum ETFs, but it may soon disappear if market sentiment improves.
