SEC Sues Consensys
Last week, the SEC sued Consensys, a major Ethereum ecosystem player, alleging it violated US securities laws with MetaMask swapping and staking services. This move is surprising because many thought the SEC wouldn’t target Ethereum 2.0-related matters, yet unsurprising due to the SEC’s ongoing scrutiny of DeFi. The lawsuit mentions Lido’s LDO and Rocket Pool’s RPL tokens as securities, underscoring the SEC’s aim to regulate liquid staking protocols. Despite this, Ethereum’s price remained stable, indicating minimal investor concern.
Ethereum ETFs Delayed
Ethereum saw a slight pullback over the weekend after the SEC delayed the approval of spot Ethereum ETFs again. The ETFs received initial approvals in late May, with final approvals expected by July 4th. However, the SEC’s request for additional documentation has pushed the potential listing date further into July. This delay might partly be due to ETF issuers working with the SEC to postpone the listings due to current market conditions, fearing significant outflows and negative impacts on asset managers and Ethereum.
Solana ETF Filings
In a surprising move, asset managers VanEck and 21Shares filed for spot Solana ETFs despite the SEC previously referring to Solana (SOL) as a security in its lawsuits against Coinbase and Binance. The filings seem premature compared to the traditional ETF approval process seen with Bitcoin and Ethereum, which involved futures contracts before spot ETFs were approved. These filings suggest a belief that a change in the US administration could lead to crypto-friendly regulations. Bloomberg analyst Eric Balchunas noted the SEC’s final decision will come just after the November elections.
Peter Thiel’s Bitcoin Price Prediction
Billionaire entrepreneur Peter Thiel recently predicted that Bitcoin’s price might not rise significantly from its current levels, citing the initial surge from spot Bitcoin ETFs already attracting the most interested buyers. Without new buyers, short-term price growth is unlikely. Despite Thiel’s caution, historical data shows diminishing returns over time. Institutional investors still expect Bitcoin to reach around $100,000. However, higher interest rates and a lack of regulatory clarity have kept many institutional investors hesitant, with long-term appreciation depending on clearer regulations and broader adoption.
US Government Sells Bitcoin
The US government recently sold nearly 4,000 BTC, causing a minor market panic. On-chain analytics revealed the BTC was sent to Coinbase for sale. This transaction was separate from the 40,000 BTC seized from the Silk Road, which the government had previously vowed to sell. This action implies that the government expects higher future prices for its remaining Bitcoin. Although the sale didn’t significantly impact Bitcoin’s price, it sparked speculation about the timing of future government sales.
Mt.Gox Repayments
The imminent return of Bitcoin to Mt. Gox creditors is poised to introduce considerable market volatility. The collapsed exchange holds 142,000 BTC, which has been sought by creditors since 2014. Potential large-scale sales could significantly impact Bitcoin’s value. If 20% of recovered BTC is sold, it would introduce approximately $2 billion in selling pressure, potentially driving prices down further amid current market conditions. Yet, this correction might precede a bullish turn, with recovery anticipated as early as August.
Top Performing Cryptos
Last week’s top-performing cryptos included dogwifhat, Arweave, Akash Network, and Avalanche.
- dogwifhat(WIF): Benefited from the filing of spot Solana ETFs, given its association with the Solana ecosystem.
- Arweave (AR): Saw gains following the passing of its 2030 proposal, which includes upgrades to its DeFi lending protocol.
- Akash Network (AKT): Pumped due to its listing on Coinbase for New York residents, highlighting the strict crypto regulations in New York.
- Avalanche (AVAX): Gained momentum after Chainlink added data stream support for its layer one blockchain, starting with the GMX derivatives DEX.
