ETH ETF is coming, which ecological Tokens are worth following?

Original Author: James, DQDQ BlockTempo

The U.S. Securities and Exchange Commission (SEC) approved the 8 ETH Ethereum Spot ETF 19 b-4 exchange rule change file in May, and major issuers have also successively submitted updated versions of the S-1 registration application. Once approved by the SEC, the ETH Ethereum Spot ETF will be open for trading on the market.

Regarding the latest progress, Nate Geraci, President of The ETF Store, stated today (8th) that the revised S-1 application submission has been completed on the 8th. It is not yet clear when the SEC will process it, but he is optimistic that the ETH Spot ETF is expected to be launched next week or the following week.

Bloomberg analyst James Seyffart previously predicted that the ETH Spot ETF may be listed later this week or during the week of July 15.

Gemini estimates in its latest research report that once the United States approves the Ethereum Spot ETF, the net inflow in the first 6 months could be as high as $5 billion. Currently, the ETH/BTC ratio is close to a multi-year low, and strong fund inflows may trigger a rally. If the ETH/BTC ratio returns to the median of the past 3 years, ETH may pump nearly 20%. If it reaches the maximum value of 0.087, it could pump 55%.

Which Ethereum ecosystem is worth following?

After the successful launch of ETH Spot ETF, if funds continue to flow in, the Ethereum ecosystem projects are expected to benefit. Therefore, it is recommended to pay close attention to the largest sectors and projects in the Ethereum ecosystem. The following will provide readers with an inventory.

Layer 2

Layer 2 aims to support the prosperity of the ETH ecosystem with high TPS and low GAS, which is self-evident. The main projects include MATIC, MNT, ARB, STX, IMX, OP, STRK, ZK, AEVO, MANTA, BLAST, etc. According to Coingecko data, the recent 30-day decline of Layer 2 ecosystem tokens ranges from 25% to 50%.

Layer 2 Token performance. Image source: CoinGecko

LSD

LSD protocol is the Node-related stake service of ETH after the transition from POW to POS, with main projects including LDO, SSV, RPL, FXS…etc. According to Coingecko data, the recent 30-day decline of LSD ecosystem Token ranges from 25% to 50%.

LSD Token performance. Image source: CoinGecko

Decentralized Finance

Decentralized Finance applications cover long aspects such as Dex, lending, stablecoin trading, stablecoin issuance, etc., with the main projects including Pendle, UNI, AAVE, COMP, CRV, MKR, etc. According to Coingecko data, the recent 30-day decline of Decentralized Finance ecosystem tokens ranges from 15% to 40%.

Decentralized Finance Token Performance. Image Source: CoinGecko

Stablecoin protocol based on ETH collateral

There are multiple ways to issue Stable Coins, one of which is asset-backed issuance. The largest asset-backed issuance includes ETH. After obtaining LSD and staking, the project will use the collateralized ETH to generate Liquidity yield. Stable Coins naturally have a dividend yield, with main projects including ENA, LBR, etc. However, ENA has recently experienced a drop of up to 60% in the past 30 days.

ENA Token performance. Image source: CoinGecko

Stake Again

Re-stake refers to staking assets again after the initial stake. Re-staking has become one of the mainstream Decentralized Finance applications on the Ethereum network, with main projects including REZ, ETHFI, ALT, BB, etc. According to Coingecko data, Decentralized Finance ecosystem tokens have recently experienced a sharp decline, with a decrease ranging from 40% to 60%.

Further stakeToken performance. Image source: CoinGecko

The adoption of ETFs in the Ethereum ecosystem could bring tremendous development opportunities. The above-mentioned projects are just a part of it. There are many other potential projects worth following. Please stay tuned to the market dynamics and make investment decisions based on your own risk tolerance.

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