Analyst: Strong Inflows into ETH ETF May Be Due to Arbitrage Strategies, Not Directional Buying

BlockBeats news, September 15: Bitfinex analysts believe that ETH's recent strength relative to BTC may stem more from "cash and carry" strategies rather than pure directional buying.

The analysts pointed out that traders may buy ETH ETFs as collateral while trading CME futures and earning yields, which could explain the recent stronger capital inflows into ETH ETFs compared to BTC ETFs. Last Friday, ETH saw about $255 million in short squeeze, exceeding BTC's approximately $172 million in short liquidations 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 full-scale shift of funds into ETH.