With the onset of the new year, the price of Ethereum swiftly embarked on an upward journey, setting a bullish tone right from the start as investors flooded in to buy Ethereum. In a short time span, Ethereum added almost 20 billion dollars to its market cap and came within touching distance of a 300 billion market cap. By the looks of it, Ethereum gained traction from all the spot ETF news in regards to Bitcoin. This was fuelled further by incoming news and speculation about spot Ethereum ETFs. Let's dive into what happened.
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The week commenced with Ethereum trading around $2277 before making a formidable leap towards $2500, hitting an intraday high of $2434. The surge can be explained by a positive sentiment in the world of crypto and multiple updated news on Ethereum spot ETFs. Unfortunately, Ethereum went on to drop to $2187, but later gained some of it back as it concluded the week with a price of 2240, a 1,62% decrease from the start of the week.
James Seyffart “updated” the markets about his thoughts on Ethereum spot ETFs by retweeting a news article. Here, the article explains how the Bloomberg ETF analyst previously suggested that the SEC's approval of Ethereum (ETH) futures exchange-traded funds (ETFs) in October 2023 implicitly designates Ethereum as a commodity. This tacit acknowledgment opens the door for a potential approval of a spot ETF in the upcoming year. Seyffart notes that while SEC Chair Gary Gensler hasn't explicitly classified Ethereum, the approval of Ethereum futures ETFs implies recognition as commodity futures. This distinction is crucial as securities and commodities ETFs are subject to different legal requirements, taxes, and regulations.
Caution remains paramount in any investment, particularly in the dynamic realm of cryptocurrencies. Never invest more than you can afford to lose. Exercise vigilance against fraud and conduct thorough research before deciding to acquire Ethereum or any other cryptocurrency.
This information aims to enlighten and is not to be construed as an investment recommendation.