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Cryptocurrencies rose on Tuesday amid a late surge in optimism over the U.S. Securities and Exchange Commission's decisions on spot exchange-traded fund applications, the first of which is scheduled for this week.
ether The coin led the rise, rising 10% to $3,710.31, according to Coin Metrics. It had earlier risen to $3,835.43. On Monday it was up 20%.
“This sudden shift in expectations is an unexpected boon for (cryptocurrency) investors who were screaming for a driver after the (Bitcoin) halving and the launch of Bitcoin ETFs in the US and Hong Kong,” said Anthony Trenchev, co-founder. Cryptocurrency exchange Nexo. “If ETH spot ETFs are approved, altcoins should take off since ether is often a leading indicator for the rest of the cryptocurrency market.”
Ether price rises on ETF optimism.
The rally began suddenly on Monday, amid reports that the Securities and Exchange Commission had requested key document updates from potential issuers and exchanges for ETFs. An SEC spokesman said the agency does not comment on individual filings.
Now, investors are reconsidering the possibility of the SEC greenlighting Ethereum ETF applications. The previous consensus was that the agency would likely not approve the funds, based on the agency's lack of participation in the filings. By contrast, in the weeks leading up to Bitcoin ETF approvals, the SEC was reportedly actively engaging with fund issuers.
Final decisions on the applications from VanEck and Ark Invest are scheduled to be made on Thursday and Friday, respectively. BlackRock, Fidelity, Invesco, Grayscale and Bitwise Asset Management also have orders awaiting decisions this year.
Ethereum futures ETFs hit the US market for the first time in October, just a few weeks after a court ruled against the SEC in a landmark case brought by Grayscale that paved the way for spot Bitcoin ETFs and may have set a precedent for spot Ether ETFs. . The court said the SEC's rejection of Grayscale's proposal to turn a popular Bitcoin fund into an ETF was “arbitrary and capricious,” and that the agency failed to explain why it agreed to list two bitcoin futures exchange-traded products (ETPs) but not bitcoin ETFs. Grayscale's proposed ETP.
Bitcoin hits the brakes
With the ether charging forward to the second day, Bitcoin Cryptocurrency stocks remained behind. The major cryptocurrency was little changed on Tuesday, maintaining a 7% gain from the previous day that pushed it above $70,000 for the first time in more than a month. Bitcoin has risen since the April CPI reading last week showed inflation falling from the previous month, which could once again open the door to a cut in US interest rates.
Cryptocurrency-related stocks initially rode the wave of positivity but also fell on Tuesday. Coinbase And Robin HoodBoth are playing on crypto trading broadly, hovering above the flat line, building on gains of 8% and 9%, respectively, from the previous session. Accurate strategywhich serves as a proxy for the price of Bitcoin, fell by 4%.
Bitcoin initially jumped along with ether on Monday but has since retreated
ETF approval could end the lull in cryptocurrencies, according to Trenchev. Bitcoin has been trading between $60,000 and $70,000 for several weeks, and investors and analysts were expecting this trend to continue for another three to five months.
“Cryptocurrencies have been hibernating since March, and we are still in this side space,” he said. “We need (Bitcoin) to break the record level before we can definitively say we are out of range.”
“Bitcoin should rise on the tail of Ethereum if we get ETF approval, but let's not get too ahead of ourselves,” he added. “One month doesn't make summer. We're in a data-focused market. If we get a hot CPI number or a really strong jobs report, you could see the calm continuing.”
