Last week, we also analyzed the price trends of ETH and its comparison with the Russell 2000. After a week of changes, we can still see that both maintain a high level of consistency, which indicates that our ongoing inference about investors' game of sector rotation is correct.

Although many funds hope to drive the emergence of altcoin season through the rise of ETH and small-cap stocks, the lack of liquidity and the tightening monetary policy have resulted in investors' risk appetite not significantly shifting.

Therefore, the difficulty of sector rotation remains quite high. The only difference is that we can indeed see significant capital inflow into the ETH spot ETF through the primary and secondary data of ETFs. Even though the purchasing power in the primary market has decreased after entering this week, the trading volume in the secondary market remains at a relatively high level.

Unlike BTC's IBIT, ETHA's trading volume far exceeds the trading volume at the end of 2024, indicating that current ETF investors still have a strong interest in ETH. If supported by the SEC's physical delivery and BlackRock's ETH staking, there is still some imaginative space.

However, for most altcoins, even if the price of ETH rises, the lack of sufficient overflow capital and liquidity makes it difficult to bring about sector rotation, let alone an altcoin season. Especially since most ETF investors, even if they take profits, may not choose to invest in altcoins in the cryptocurrency market.

This article is sponsored by #Bitget ｜ @Bitget_zh

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