Bitcoin
Ether jumps 20% on renewed optimism for an ETF, bitcoin also rises
- The price of ether continued to rise, after spiking 20% on Monday.
- The rally comes amid a late surge in optimism that the SEC could give the green light to localizing ether ETFs before its first deadline later this week.
- The previous consensus was that the funds were unlikely to be approved.
Omar Marques | Light Rocket | Getty Images
Cryptocurrencies rose on Tuesday amid a late surge in optimism surrounding the U.S. Securities and Exchange Commission’s rulings on spot ether exchange-traded fund applications, the first of which will be released this week.
Ether led the rally, rising 12% to $3,785.42, according to Coin Metrics, after soaring 20% on Monday.
“This sudden shift in expectations is an unexpected boon for investors clamoring for a boost after the [Bitcoin] halving has been approved and bitcoin ETFs have been launched in the US and Hong Kong,” said Antoni Trenchev, co-founder and managing partner of Nexo. “If spot ETH ETFs are approved, altcoins should take off as ether is often a leading indicator for the rest of the crypto market.”
See the graph…
Ether Rebounds on ETF Optimism
About that, Bitcoin added 2% and traded at around $71,350, extending a 7% gain from the previous day. The main cryptocurrency was rising from last week’s April CPI reading showed inflation eased compared to the previous monthwhich could open the door again for rate cuts in the US. This week’s rally pushed bitcoin above $70,000 for the first time in more than a month.
Crypto-related stocks rode the wave. Coin base It is Robinhoodwhich deals in cryptocurrency trading in general, each rose about 2%, adding to Monday’s gains of 8% and 9%, respectively. Microstrategy, which is more of a proxy for the price of bitcoin, added 1%. Bitcoin miners also gained slightly, with Riot Platforms It is Irene (formerly known as Iris Energy), each advancing 2%, and Digital Marathon It is CleanSpark each increasing by 1%.
The rally began suddenly on Monday amid reports that the SEC requested updates to key documents from potential ETF issuers and exchanges. An SEC spokesperson said the agency does not comment on individual filings.
Now, investors are reconsidering the likelihood of the SEC greenlighting ether ETF applications. O previous consensus was that the SEC was unlikely to approve the funds, based on the agency’s lack of involvement in the filings. On the other hand, in the weeks leading up to approvals for bitcoin ETFs, it was reported that the SEC was actively engaging with fund issuers.
Final decisions on VanEck and Ark Invest’s applications will be released this Thursday and Friday, respectively.
BlackRock, Fidelity, Invesco, Grayscale and Bitwise Asset Management also have applications awaiting decision this year.
Approval of the Ethereum ETF could put an end to the lull in crypto, according to Trenchev – which several investors and analysts expected to last another three to five months.
“Crypto has been dormant since March and we are still in this sideways space,” he said. “We need [bitcoin] break the record before we can categorically say we’ve gone off track.”
“Bitcoin should ride Ethereum’s coattails if we get approval, but let’s not get too ahead of ourselves,” he added. “A month is not summer. We are in a data-centric market. If we get a hot CPI number or a really strong jobs report, you could see the doldrums continue.”