Bitwise released a new correlation analysis today as part of its new Ethereum spot ETF application. This is the first Ethereum correlation analysis that replicates the specific methodology used by the SEC in evaluating Bitcoin, and the results are encouraging.
Correlation values for the entire sample time period only differ by no more than 0.2% in terms of hourly correlations, 5% in terms of five-minute correlations, and 8% in terms of one-minute correlations. To replicate the specific methodology used by the SEC in evaluating Bitcoin, Bitwise’s research used:
-Sample time period of the same length: approximately 2.5 years
-Same intraday correlation intervals: 1 hour, 5 minutes and 1 minute
-Same Market: Coinbase/Kraken VS CME
-Same correlation statistic: Pearson correlation of log returns
-Same three-month rolling window min/max analysis
Bitwise believes that the analysis results show that there is a strong correlation between the ETH spot market and the CME ETH futures market, which is very similar to the SEC’s research findings in the Bitcoin spot ETF approval order.