Ethereum
Why Bitcoin, Ethereum and Dogecoin rose this week
These three megacap tokens are moving forward on the heels of a big potential catalyst.
The world of cryptocurrencies has been on a wild ride this week, but it’s mostly been a wild ride for investors in the biggest blockchain projects. Bitcoin (BTC -0.44%), Ethereum (ETH 2.98%) and Dogecoin (DOGE -0.83%) have seen notable bullish moves over the past week, with increases of 3.3%, 28.7%, and 5% over the past week as of noon ET Thursday.
The story this week that seems like a rising tide is lifting the boats of all large-cap digital assets is the expectation that a decision will be issued this week on whether the Securities and Exchange Commission (SEC ) will approve Ethereum spot ETFs.
Bitcoin has been in a race toward final approval of spot ETFs for this crypto, and there has been an influx of capital into the asset. This is a clear and significant catalyst for the entire industry and could lead to other similar products down the road.
Let’s take a look at each of these tokens and what to watch in the coming week.
Are Ethereum Spot ETFs Coming?
Some level of uncertainty remains regarding regulators’ final decision for the VanEck spot Ethereum application (expected later today) and the ARK 21Shares ETF application expected tomorrow. Earlier this week, the expectation was that we wouldn’t hear anything until next week at the earliest. As a result, as the calendar moves forward, investors will soon see if these bullish bets were correct.
A potential flow of capital into Ethereum could disrupt inflows into Bitcoin-focused spot ETF funds. So, the price action we are seeing with Bitcoin ahead of this announcement is not surprising. Ethereum’s gain should (at least to some extent) be Bitcoin’s loss, although it’s worth noting that Bitcoin has still trended positively following this news, as it’s good for the industry in its entirety. together.
Dogecoin’s price action appears to be relatively detached from the two major cryptocurrencies in terms of market capitalization. That said, expectations of greater liquidity in this space thanks to institutional investors are pushing traders to step up their more speculative bets to capture the maximum upside potential today.
Where to go from here
Personally, I think the safest place to be right now when it comes to these major digital assets is on the sidelines. Yes, there is major upside potential if the SEC rules in favor of Ethereum spot ETFs. But I think the downside risk of a “no” vote could outweigh any future gains (and of course, a lot has already been priced in).
Various regulators have displayed varying levels of enthusiasm for these Ethereum ETF spot products, so the outcome remains uncertain. Until we have official approval, this is an enabler that I don’t think is worth using at this time.