Crypto Market Shows Mixed Performance: Cryptocurrency prices showed significant variation on Wednesday
after Bitcoin reached a record high of $94,068.75 on Tuesday,
driven by optimism about the future of digital currencies under the new U.S. administration
led by President-elect Donald Trump.
However, Bitcoin dropped by 0.33% to $92,632.04 as of 9:21 AM Mecca time. Content
While Ethereum remained stable at $3,109.31, Dogecoin declined by 1.47% to $0.39, and Ripple rose by 0.92% to $1.0933.
Bitcoin’s record surge was attributed to a “CoinDesk” report about the nomination of attorney Judy Guillen,
a cryptocurrency expert and former SEC official, to lead the Securities and Exchange Commission
under Trump’s administration.
This news fueled optimism regarding cryptocurrency regulations,
with investors seeing it as an opportunity to enhance the digital investment environment.
Reports also indicated discussions between “Trump Media Group” and the cryptocurrency platform “Bakkt.”
suggesting a potential acquisition to bolster Bitcoin’s position and attract more investment.
Despite these positive developments, rising geopolitical risks, especially the Russia-Ukraine conflict,
reduced investor appetite for high-risk assets, including cryptocurrencies.
This geopolitical uncertainty limited gains for Bitcoin and other digital currencies.
Nasdaq Launches Bitcoin Options
Nasdaq launched trading for Bitcoin ETF options, the first in the industry. BlackRock’s “iShares Bitcoin Trust” saw substantial demand,
with over $2 billion invested on the first trading day.
This initiative highlights efforts to provide innovative tools for institutional cryptocurrency trading.
Crypto Market Outlook
The cryptocurrency market continues to attract investors due
to regulatory and political developments and the entry of major financial institutions like BlackRock.
However, geopolitical risks and market volatility remain significant challenges to price stability. In conclusion, the mixed performance of cryptocurrencies this week highlights the market’s sensitivity to political,
regulatory, and geopolitical factors.
As the Trump administration’s policies on digital currencies unfold,
the sector faces opportunities for growth or correction.
Oil Price Rise on Expectations of Declining U.S. Inventories: Oil prices rose, halting several losses that lasted several sessions.
They rose on expectations of declining U.S. crude and gasoline inventories despite concerns about weak global demand amid a slowing economic recovery in China.
$107 Million Flows into Ethereum Funds on First Day of Trading in the U.S.
According to Bloomberg data, the first U.S. exchange-traded funds
investing directly in the Ethereum cryptocurrency recorded a net inflow of $107 million after their official launch on Tuesday.
The “iShares Ethereum Trust” by BlackRock achieved the highest total of $267 million,
followed by “Bitwise Ethereum” at $204 million, and then “Fidelity Ethereum Fund” at $71 million.
Oil Price Rise on Expectations of Declining U.S. Inventories
Oil prices rose, halting a series of losses that lasted several sessions.
They rose on expectations of declining U.S. crude and gasoline inventories
despite concerns about weak global demand amid a slowing economic recovery in China.
Russia’s Oil Production Approaches OPEC+ Agreed Quotas
Russian Deputy Prime Minister Alexander Novak stated that
Russia’s oil production is approaching the quotas agreed upon with the OPEC+ group without providing details on the production volume.
Russia admitted last month that its oil production in May exceeded
the quotas set by the OPEC+ group but pledged to meet its commitments.
Oil Prices Rise on Expectations of Declining U.S. Inventories
Ether and Solana Overtake Bitcoin in Crypto Bets Amid ETF Hype: The price of Solana rose at the highest pace in over a month,
while Ethereum has climbed 51% since the beginning of the year, compared to Bitcoin’s 45% increase. Ethereum and Solana have started to steal the spotlight from their bigger sibling, Bitcoin,
as excitement over the launch of exchange-traded funds (ETFs) in the U.S. shifts to the smaller cryptocurrencies.
Solana’s price rose rapidly in over a month after investment firm VanEck filed to launch a cryptocurrency ETF.
Additionally, Ethereum has outperformed Bitcoin since the beginning of 2024 as final approvals for ETFs focusing on Ethereum investment draw near.
Spotlight on Bitcoin at the Beginning of the Year
At the beginning of 2024, the spotlight was entirely on Bitcoin when the first spot ETFs launched in the U.S. with the largest digital assets. Bitcoin ETFs launched by companies such as BlackRock and Fidelity Investments attracted significant inflows,
driving Bitcoin’s price to a record high of $73,798 in March, but demand and price have since declined.
Approval by the U.S. Securities and Exchange Commission
Last month, the U.S. Securities and Exchange Commission (SEC) approved exchange proposals to list spot ETFs dealing with Ethereum.
Some reports indicate that final approvals for these funds may be issued next week.
Future Prospects for Ethereum Funds
Analysts have begun to abandon modest expectations for demand for ETFs that include Ethereum,
the second-largest cryptocurrency, which is less widespread than Bitcoin.
According to “Galaxy Digital Holdings” and “Fundstrat Global Advisors,” U.S. ETFs could see net inflows of $5 billion in the first five months.
Speculations on ETF Approval Supporting Ethereum
In a research note, Sean Farrell, head of digital asset strategy at “Fundstrat,” wrote:
“Investors are adopting very bearish expectations regarding the imminent launch of Ethereum ETFs.”
He expects these ETFs to be boosted by hedge funds attempting to profit from the price difference between spot Ethereum and futures contracts.
Ethereum’s price has risen 51% since the beginning of the year,
surpassing Bitcoin, which saw a 45% increase. Solana’s value,
known by the “SOL” ticker, increased by 754% over the past 12 months before Thursday’s gains, ranking fifth among digital assets.
Bitcoin ETFs in the U.S.
Since their listing in January, Bitcoin ETFs in the U.S. have attracted $14.5 billion in net inflows.
Analysts at “J.P. Morgan Chase” estimate that potential Ethereum portfolios could attract
between $1 billion (in modest estimates) and $3 billion in net inflows during the remainder of 2024.
U.S. Authorities’ Stance on Cryptocurrencies
The SEC unexpectedly shifted its stance towards approving spot ETFs that track Ethereum prices after reluctantly allowing Bitcoin ETFs following a court ruling in 2023.
Ambiguity Around Ethereum’s Classification
While Bitcoin is viewed as a commodity, the SEC, chaired by Gary Gensler,
states that most other digital currencies are unregistered securities that should be subject to its regulation.
Gensler’s stance on Ethereum and whether it is considered a security remains ambiguous.
Solana Classified as Unregistered Securities
However, Solana is one of more than 12 currencies the SEC has classified in various lawsuits as unregistered securities.
This raises doubts about whether the regulator will allow the launch of ETFs tracking Solana.
VanEck’s application to launch an ETF does not guarantee SEC approval.
Performance of Cryptocurrencies in the Markets
Bitcoin’s price rose about 0.5%, trading at $61,700 at 12:10 PM on Friday in Singapore.
Ethereum’s price climbed to $3,453, while Solana’s price dropped 1.5% to $147.
Ether and Solana Overtake Bitcoin in Crypto Bets Amid ETF Hype
Ethereum Rises Amid SEC Investigations: Ethereum (Ether) saw a significant increase amid speculation
that U.S. regulatory scrutiny of the blockchain system supporting the world’s second-largest digital asset might ease.
This rise also led Bitcoin and a range of smaller competing cryptocurrencies to record slight gains.
Ether recorded its best rise this week, increasing by 3.6% on Wednesday before slightly retreating to trade at $3,562 as of 12:53 PM Singapore time.
This rise led Bitcoin, the market-leading cryptocurrency, and a range of smaller competing cryptocurrencies to record slight gains.
The Role of Ethereum Technology in the Market
Ether is used in the Ethereum blockchain, considered the most important network for financial services based on cryptocurrencies.
The U.S. Securities and Exchange Commission (SEC) investigation into the Ethereum Foundation highlighted
There is uncertainty about whether Ether is an unregistered security.
This status could reduce demand for the digital asset.
Conclusion of Investigations
In a post on platform X, Consensys, the leading developer of Ethereum, announced that
“the SEC’s Enforcement Division informed us that it will close its investigation into Ethereum 2.0.”
The company added that “the decision comes after we sent a letter on June 7 asking the SEC to confirm
that the approvals issued regarding the Ethereum exchange-traded fund in May,
which were based on considering the digital currency as a commodity, meaning that the SEC will close its investigation into Ethereum 2.0.”
The SEC did not immediately respond to a request for comment on Consensys’s claims,
noting that the request was sent outside official working hours.
Consensys had filed a lawsuit against the SEC in April to prevent Ethereum’s regulation.
SEC Audits
Last month, the SEC signed off on a proposal from platforms operated by Cboe Global Markets, Nasdaq,
and the New York Stock Exchange to list exchange-traded funds (ETFs) that invest directly in Ether.
Further approvals are still needed before applicants like BlackRock and Fidelity Investments can launch such products for the first time.
While Bitcoin is viewed as a commodity, the SEC says most other digital currencies are unregistered securities that should be subject to its oversight.
However, SEC Chairman Gary Gensler has been ambiguous about whether Ether is a security.
Cryptocurrency enthusiasts are concerned about the digital token and potential projects based on the Ethereum blockchain
being subject to the SEC’s strict and costly rules.
Bloomberg News reported in March that the SEC had sought information from companies
about their dealings with the Ethereum Foundation to review aspects of Ether.
The foundation’s website describes the organization as a nonprofit supporting Ethereum and related technologies.
Bitcoin Price Hits One-Week Low Ahead of Inflation and Interest Rate Data: The largest cryptocurrency dropped 2.5% to its lowest level in a week,
trading below $68,000 as of 12:42 PM Singapore time.
Smaller cryptocurrencies such as Ethereum and Dogecoin also declined.
Bitcoin reached a record high of $73,798 in March, driven by investment inflows into U.S.-traded exchange-traded funds,
but has struggled to achieve new highs since then.
The inflation data and Federal Reserve expectations are scheduled for release on Wednesday
and may confirm fears that interest rates will remain high for longer,
creating an unfavorable environment for speculation on assets like cryptocurrencies.
Anand Gomes, co-founder of the derivatives platform “Paradigm,”
stated that “a lack of news is considered bad in cryptocurrency,
as the market constantly needs positive news to stay buoyant.
So, when there is no news, the market tends to decline.”
Bitcoin Price Hits One-Week Low Ahead of Inflation and Interest Rate Data
“Ethereum” ETF Approval Optimism Fuels Crypto Frenzy: Frenzied Activity in the Crypto Market Ahead of the Anticipated Approval Date on May 23. The US Securities and Exchange Commission (SEC) has Requested Updates to “19b-4” Filings to Change the Rules Allowing Trading. Standard Chartered Expectations Inflows into “Ethereum” Funds Between $15 and $45 Billion in the First 12 Months.
The cryptocurrency market is engulfed in a frenzy amid increasing optimism for regulatory
approval of exchange-traded funds (ETFs) that invest directly in Ether, marking a sharp shift in sentiment.
This change comes amidst a wave of activity among potential fund issuers,
the stock exchanges where they will be traded,
the US Securities and Exchange Commission (SEC).
The US Securities and Exchange Commission:
The SEC has asked the New York Stock Exchange and Cboe Global Markets to update their “19b-4” filings,
which propose rule changes to allow funds to trade on the exchanges,
according to informed sources who requested anonymity.
One insider said this step indicates that the chances of SEC approval might increase.
However, he added that a green light is by no means guaranteed.
One of the sources mentioned that the US regulator requested what is known as a global comment,
meaning all filings must be resubmitted using the same language.
Meanwhile, on Tuesday, Fidelity Investments updated its S-1 registration statement with the SEC
Regarding its application to list its spot trading fund in Ethereum.
Among other things, the issuer stated it will keep the Ether it buys from programs that
pay rewards for blockchain maintenance – a process known in industry terms as staking.
– and will not invest in derivatives.
Staking has sparked contention for Ether,
raising questions about whether regulators should treat the token as a security.
Increased Activity:
The increased activity between the SEC, investment firms,
and exchanges comes before the May 23 deadline for the regulator to approve or deny VanEck’s fund application.
In a note, Gautam Chhugani and Mahika Sapra, analysts at Bernstein, said,
“Given the political drama behind the scenes, approval will be seen as significant regulatory relief for the sector.
We expect a more lenient regime ahead of the US presidential elections.”
Ethereum Price Surge:
Ether, the native token of the Ethereum blockchain and the most important commercial highway in the crypto space,
Began to rise on Monday and surged by up to 25% in the past two days.
It traded at around $3,800 after Bloomberg Intelligence ETF analyst Eric Balchunas said
he raised the likelihood of approval for a spot ETF in Ether from 25% to 75%.
An SEC spokesperson said the agency does not comment on individual filings.
Spokespeople for the New York Stock Exchange, Nasdaq, and Cboe declined to comment.
Grayscale did not immediately respond to a request for comment.
In a recent note, an analyst at Standard Chartered, Jeff Kendrick, said,
“We expect significant ETF-driven inflows to Ethereum, similar to Bitcoin ETFs since their approval.”
Kendrick estimated that spot Ethereum ETFs could attract inflows of
about $15 billion to $45 billion in the first 12 months after approval.
Bitcoin ETFs:
In January, the SEC faced a similar deadline for Bitcoin ETFs and ended up approving 10 funds simultaneously.
These approvals were also preceded by a series of document amendments requested by the regulator.
Bloomberg reported on May 17 that the lack of similarly robust interaction with the regulator before Monday
led some issuers to brace for rejections.
The new batch of Bitcoin ETFs in the US has attracted net inflows of about $13 billion,
accumulating nearly $59 billion in assets since their launch on January 11.
They have been hailed as one of the best product category launches in industry history.
On April 30, Bitcoin and Ether ETFs also started trading in Hong Kong.
They currently manage $294 million in assets.
Increasing Speculation of Approval:
Another notable sign of growing speculation for approval is the Grayscale Ethereum Trust (ticker ETHE),
which Grayscale Investments hopes to convert into an ETF if the SEC approves.
According to data compiled by Bloomberg, the fund ended Monday
trading at a nearly 12% discount to its underlying Ether holdings,
a significant improvement from a 20.5% discount on Friday
and a sharp decrease from a 53% discount recorded a year ago.
The SEC observed a similar pattern in January before approving the conversion of Grayscale’s Bitcoin Trust.
Which now trades at par with its underlying assets.
Ether prices began to rise on Monday after Bloomberg Intelligence ETF analyst Eric Balchunas raised
The likelihood of approval for a spot ETF in Ether is 25% to 75%.
An SEC spokesperson said the agency does not comment on individual filings.
Spokespeople for the New York Stock Exchange, Nasdaq, and Cboe declined to comment.
Grayscale did not immediately respond to a request for comment.
Ethereum’s value rose with the awaited debut of its ETFs:
Ethereum has become a focal point in the world of digital currencies
after it experienced its biggest leap in over a month.
This rise is linked to speculations about the possibility of launching new American-traded investment funds for the currency.
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Ethereum Gains
Spot Bitcoin Trading Funds
Traded Investment Funds Enhance the Value of “Ethereum”
Securities and Exchange Commission
Ethereum Gains
The second-largest digital currency was traded at around $3,710
maintaining gains of 8.5% from its peak during American trading hours. Ethereum’s gains, which reached 62% since the beginning of the year,
are close to the 68% increase achieved by Bitcoin, the largest currency in the market.
Spot Bitcoin Trading Funds
Edward Chin, the co-founder of the digital hedge fund “Parataxis Capital,”
said there were discussions about a meeting between the issuers
of traded investment funds for the Ethereum currency and the US Securities and Exchange Commission.
The Securities and Exchange Commission,
which was initially skeptical, approved spot Bitcoin trading funds in the American exchange in January
after a court decision last year.
Since their launch in January, these funds have collected assets worth $59 billion,
making them among the most successful launches of a fund category ever.
This helped raise the value of “Bitcoin” to a record level in mid-March.
Traded Investment Funds Enhance the Value of Ethereum.
Investors realize the potential for “Ethereum’s” value to rise if the commission
allows the launch of traded investment funds directly containing the digital currency.
Major investment companies such as “Black Rock” and “Fidelity Investments”
have applied to launch such funds, but there are doubts about whether the regulatory authority will approve this.
Although “Bitcoin” is considered a commodity, the Securities and Exchange Commission
says that most other digital currencies are considered unregistered securities,
meaning the digital asset sector is rife with non-compliance.
Undoubtedly, explicitly classifying Ethereum as unregistered securities would
increase the challenges of launching a traded investment fund.
Securities and Exchange Commission
The Securities and Exchange Commission’s approval of “Bitcoin” spot funds
also depends on the relationship between the traded Bitcoin futures contracts
on the Chicago Mercantile Exchange and the price movements of the digital asset itself,
which was considered sufficient to detect fraud and manipulation.
Analysts for traded investment funds at “Bloomberg Intelligence,” James Seyffart and Eric Balchunas,
noted in a memo issued in late March,
a 75% probability that the Securities and Exchange Commission would reject “Ethereum” requests by May,
indicating that the decision could depend on data “showing relatively weak correlations between spot markets and futures markets.”
The Securities and Exchange Commission did not immediately respond
to a request for comment on any discussions related to the requests for
launching traded investment funds for the “Ethereum” currency between it and the potential issuers,
Note that they submitted the request after the official working hours.
Ethereum’s value rose with the awaited debut of its ETFs
The Ethereum Foundation is under scrutiny by the SEC in the latest cryptocurrency crackdown: According to people familiar with the matter,
the US Securities and Exchange Commission has requested information from companies
about their dealings with the Ethereum Foundation to review aspects of Ethereum – the world’s second-largest cryptocurrency.
The recent SEC investigation may represent a significant escalation by Wall Street’s main regulatory body in its years-long
campaign against the cryptocurrency industry.
The agency’s chair, Gary Gensler, says many digital assets are unregistered securities and are subject to SEC regulations.
He has declined to say whether Ether is part of that group.
Although Gensler has avoided declaring Ethereum’s status,
he has indicated that a feature of the Ethereum software could bring Ether under its jurisdiction.
Such a determination would lead to a series of compliance and investor protection rules,
which many in the cryptocurrency industry say are unsuitable for digital assets.
Declaring Ethereum a Security
Declaring Ethereum as a security would also impact the broader cryptocurrency market
because developers widely use the Ethereum blockchain throughout the industry.
Meanwhile, major investment firms seek the SEC’s approval to list exchange-traded products based on Ether.
SEC Comment
The SEC declined to comment.
A representative for the Ethereum Foundation, a nonprofit organization based in Switzerland,
did not respond to requests for comment. CoinDesk reported the SEC review earlier.
A subpoena from the regulatory body sought more information about various aspects of the Ethereum Foundation,
according to one of the people who requested anonymity and discussed the information requests.
The full scope of the requests was not immediately clear.
Ethereum’s New Process
Some in the financial industry have said that the way the organization initially offered Ether in 2014 resembled a securities offering.
Concerns diminished during the Trump era when a top SEC official said transactions involving the token are not subject to federal securities rules.
Gensler then seemed to open the door for a reversal in September 2022 when he objected to the upgraded Ethereum blockchain, dubbed “Merge.”
At that time, Gensler said that Ethereum’s new process known as “proof of stake,”
where coin holders can earn financial rewards by allowing the network to use some of their assets,
which could fall under securities regulations. Ethereum had previously used Bitcoin’s “proof of work” method to run its blockchain.
Bitcoin
Bitcoin, the world’s largest digital asset, is the only cryptocurrency Gensler has definitively stated that it is not a security in his view.
However, the Commodity Futures Trading Commission, Washington’s other main market regulator,
has indicated that it does not consider Ethereum security and oversees trading in derivatives based on the token.
The Ethereum Foundation is under scrutiny by the SEC in the latest cryptocurrency crackdown.
