The Ether Surge: Analyzing Recent Trends and ETF Inflows

Time now for the big story breakdown on this Thursday morning.

Crypto majors have continued their range-bound trading action this week.

A lot of sideways action.

Bitcoin and E recovered some of their weekend losses but have yet to advance to new highs as of late.

All this despite new favorable guidance from regulators.

The SEC emphasizing that liquid staking is not considered the offer and sale of securities.

Meanwhile, the CFTC is green lighting federal trading of a spot.

Crypto assets.

Joining me this morning here live on set from the New York Stock Exchange, Andy Beyer, longtime friend of the show, head of product and research at Coin Desk Indexes.

Andy, welcome.

Thank you for being here.

Thanks.

We're trying to take a summer vacation, but no dice this summer.

I'm not familiar with much.

What's that word vacation?

I'm unfamiliar.

I know we're in the same boat.

We're in the same boat.

I want to ask you about BTC and EI stuck in a little bit of a kind of sideways trading range here as of late.

We're seeing a dip in.

We've also seen a lot of crypto ETF outflows.

What are you seeing, Andy?

What's going on here?

Two weeks we came on and noted the deceleration of this massive rally that we had from the end of April until the end of July.

And I don't know.

In my view, I'm a simple person.

I like to think of things in chunks, and these crypto rallies over the last couple of years tend to last a quarter and then they pause and then you kind of see where you're going next.

So we were pretty happy after that rally coming into August with things to settle down a little bit and Excitement to come down.

Last Friday's move down in Bitcoin below the 113 112 level caused some people to get concerned.

It's nice to see Bitcoin back over 116,000.

Ether has been the really powerhouse of this move in the quarter between the end of April and the end of July.

It's contributed 50% of the coins 20s rally to over 4000 over that period.

So it's really been the ether story, which is what we've been calling.

For for a long time an ether-led rally.

Talk to me about what you're seeing the latest out of the regulators, the SEC and the CFTC.

I mean, you are on a fundamental different regulator backdrop than we were in the Gary Gensler era where there was so much frustration about the previous SEC's unwillingness to define what's a security, what's a commodity.

What are we hearing from regulators today?

I'm trying to think of the cheeky headline for my weekly column.

I'm thinking like, is was that so hard?

It might be a good one that down.

Uh, let's see, I have to look at my notes.

July 31st, Chair, I can's speech on Project Crypto on August 4th, as you know, the CFTC chair FA is saying, you know what?

The CFTC doesn't regulate spot markets, but crypto might be a good place to start and let DCMs handle that.

On August 5th, the statement from the SEC that liquids taking tokens aren't necessarily a security which should let them participate both for direct ownership and participation in ETFs.

And then just overnight the president directed the Department of Labor to look into ways that retirement accounts, 401ks can participate.

In all kinds of alternatives including crypto.

So it's it's really that on top of the Genius Act being passed on July 18th and the upcoming Clarity Act, we're getting that kind of not only we're getting regulatory support and structure from the regulators in addition to a declarations that enforcement actions that are based on more vapor are going to be halted immediately.

Yeah, we're going to have a lot of conversation today and in the near term future about that 401k contribution.

We've been talking about it for a long time, but I think now you have a White House that's more willing to have those conversations for sure.

I think you know it's a space I follow very closely from from, you know, from previous roles and you know, people, their default choice into a 401k is a target date fund which has very traditional assets and has some very good properties about GlidePath.

But if I'm thinking about the money that I'm going to hold for 1020, 30 years and not touch it.

You kind of want to have something in there that has some potential convexity.

Some look towards the future. equities do that a little bit obviously with economic growth, but having a little bit of digital asset and there is a new asset class that could potentially explode over 1020, 30 years doesn't seem like a bad thing to consider.

So we're glad that that might be entertained as a new participant in the 401k market.

Talk to me about what's going on with the latest over the Coin Desk 5 and Coin desk.

20 indexes even over just the last few days.

Yeah, so up until July we had really good push.

Coin desk 20 got back over 4000 and again, the most remarkable thing is that Ether over the previous quarter contributed 50% of that rally.

That helped broaden things out a lot.

Normally we're seeing Bitcoin led rallies.

Bitcoin was only responsible for about 12-13% of that rally.

XRP also, so it was a broader rally.

It helps the In case it helps link the idea that Ethereum and the new popularity of stablecoins are linked.

Actually over the last couple of days, the number of transactions on the Ethereum network have reached very, very close to all-time highs, and that is due in large part to stablecoins as well as trading on decentralized platforms.

So for investors just getting started and thinking about E, knitting together this activity in stablecoins and the activity in ether is a really good.

Intuitive hook for them to hold on to.

ET is up 180% off the April 7th lows.

I mean, it's right.

I mean, it's snuck up on us.

We think that it started as a short squeeze in the hedge fund community and then the ETF inflows started to happen.

There was a record $12.8 billion of ETF inflows in July, but most importantly, over $5 billion of that was into ET ETF.

So the story is catching.

I think that we're The market has hopefully digested the Bitcoin story, which is still a great story, but is now looking a bit broader.

Yeah, we're about out of time, but it's interesting to watch the Tom Leess of the world sort of kind of, I guess, kind of do what the Michael Saylors of the world did for Bitcoin, now making really the permeable case over E for everyday investors.

Certainly they should be thinking about Bitcoin as an individual macro asset store of value, and Eth and many others as pieces of software that represent growth in blockchain.

Um, ET is a great place to start for that.

And yes, between the Treasury holding companies and the analysts and the market action, we're going to see a lot more interest in it that will help prompt more interest in other layer ones and get us the breadth that we like so much.

To quote a wise man, was that so hard?

Was that so hard?

There you go.

The great Andy Beer, head of product and research at CoinDex Indicees, thanks for being here.

Great to have you as always.

My pleasure.

Good to see you, JD.