Analyst: ETH ETF Inflows Driven by Arbitrage Strategies

On September 15, Bitfinex analysts stated that the recent strength of ETH relative to BTC is primarily due to "cash and arbitrage" strategies rather than directional buying. The analysts pointed out that traders may be using ETH ETFs as collateral while trading CME futures to generate profits, which explains the stronger inflows into ETH ETFs compared to BTC ETFs recently. Last Friday, ETH experienced a short squeeze of approximately $255 million, surpassing the $172 million in short liquidations for BTC during the same period. Therefore, before more spot buying that does not rely on short squeezes emerges, the strong demand for ETH ETFs is more likely to reflect position allocation rather than a complete shift of funds towards ETH.

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