Ethereum
Ethereum plunges 4% after historic ETF approvals
Ethereum fell 4% immediately after the historic approval from the United States Ethereum spot exchange-traded funds (ETFs) yesterday.
Many believed that the move from spot ETFs to the United States would be a bullish event for the world’s second-largest cryptocurrency. And that may still be the case. But within hours of approval from the U.S. Securities and Exchange Commission (SEC), Ethereum price barely moved…up just 1%.
At the time of approval, Ethereum stood at $3,840 but is now down 3.6% to $3,701, according to CoinGecko. This decline is even more pronounced in the last 24 hours, falling 6% from $3,926 as news of the approval began to circulate.
This is a typical demonstration of “buy the rumor, sell the news” as Ethereum price climbed 9% within minutes of rumors that ETF approval was imminent. Now that the news is confirmed, the market has started to sell off.
Bitcoin saw similar action after the approval of spot Bitcoin ETFs in January. The day after Bitcoin approval plunged about 6% and then dived 12% during the coming week. All told, BTC only returned to the price it was on the day the ETFs were approved after a full month of volatility.
But when that happened, it started a steady trek towards a new absolute record as volume of the 10 spot Bitcoin ETFs flocked to the market.
British multinational bank Standard Chartered predicts that ETH and BTC will soar after the approval of Ethereum ETFs.
“The approval of the ETH ETF will further legitimize the sector and therefore be positive for BTC as well,” said Geoff Kendrick, digital assets researcher at Standard Chartered, adding that he would “expect a new all-time high in the BTC by the weekend.”
If it has to happen for Bitcoin, it may not be for tomorrow. BTC is currently down 3.5% in the last 24 hours.
Edited by Stacy Elliott.