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The cryptocurrency market is abuzz with anticipation as famous crypto analyst Pentoshi predicts a potential rally for Ethereum (ETH) to reach $3,400. The catalyst behind this optimistic forecast is the expected approval of spot Ethereum Exchange-Traded Funds (ETFs) in the coming year.

Earlier this year, major players in the asset management arena, including Ark Invest and 21Shares, submitted applications for spot-based Ethereum ETFs to the U.S. Securities and Exchange Commission (SEC). If approved, these ETFs could pave the way for increased institutional participation and capital inflow into the Ethereum market.

ETF approval boost

In a tweet, Pentoshi stated that they had been expressing bullish sentiment about the Bitcoin ETF when its price ranged between $25,000 and $28,000. He anticipated a similar situation with the Ethereum ETF in 2024. According to him, irrespective of one's beliefs, it all boils down to game theory.

As the approval date approaches, the analyst speculates that holders may become less inclined to sell their Ethereum, while others may feel compelled to enter the market, creating upward pressure on the price. Pentoshi pointed out that figures of $2,7xx and $3,400 were potential scenarios for Ethereum’s price.

As of the latest market data, the current price of Ethereum stands at $2,281, representing a marginal decline of 0.37% over the past 24 hours. The market now awaits regulatory decisions regarding Ethereum ETFs, with potential approval seen as a crucial factor in determining the short-to-medium-term trajectory of ETH prices.

While market analysts and enthusiasts closely monitor developments in the ETF approval process, the crypto community remains divided on the potential impact of such regulatory decisions. Some believe that ETF approval will act as a strong catalyst for Ethereum's price, opening new avenues for institutional investment. Others caution that market reactions may be unpredictable, emphasizing the need for careful analysis and risk management.