Spot Ethereum ETFs Approval Shakes the Market
Last week, the SEC surprised the crypto market by approving eight spot Ethereum ETF applications. This unexpected move led to a 20% surge in ETH prices, though the actual approval had a muted effect as the market had already priced it in. For these ETFs to be listed, S1 approvals are needed, which could take some time. ETH’s future trajectory remains uncertain, with potential resistance at $3,900 and support around $3,200. Technical indicators suggest a possible rally to $4,600 if bullish patterns hold.
Pro-Crypto Political Shifts
The SEC’s approval of spot Ethereum ETFs is believed to be due to political pressure, as US politicians show increasing support for crypto. A resolution related to an SEC rule preventing banks from providing crypto custody was passed with bipartisan support, though President Biden has yet to sign it. The FIT 21 bill, which aims to provide regulatory clarity and give the CFTC control over certain crypto activities, also passed the House. However, it still needs Senate approval, which may take weeks due to potential revisions.
Donald Trump’s Pro-Crypto Stance
Donald Trump’s recent pro-crypto stance has influenced the political landscape. An exclusive dinner for NFT holders, including notable crypto advocates, seems to have swayed Trump. His public declarations to keep anti-crypto politicians away from BTC and his promises to pardon crypto figures have garnered attention. This shift is significant as Trump’s support could impact swing states in upcoming elections.
SEC vs. Uniswap and Consensus
The SEC’s aggressive stance towards Uniswap and Consensus may be softening due to political pressure. Uniswap recently responded to an SEC Wells Notice with a submission arguing against a lawsuit. Historically, 80% of Wells Notices result in lawsuits, but political influences might alter this outcome. The SEC’s next steps could be pivotal, especially if illegal activities were discovered.
Gala Games Exploit
Gala Games was exploited for $200 million worth of tokens, causing a significant drop in GALA’s price. A hacker manipulated the token smart contract to mint 5 billion tokens, selling them for $22 million. The hacker later returned the funds, and Gala Games plans to repurchase the tokens, potentially stabilizing the price. Additionally, DWF Labs announced a $1 million purchase of GALA tokens to aid recovery.
Retail Investors’ Absence
Retail interest in crypto is at its lowest since 2019, indicating that experienced investors and institutions drive recent price actions. Spot Bitcoin ETFs have accelerated BTC’s pump, and similar effects are expected once spot Ethereum ETFs are listed. Retail investors are anticipated to enter the market later, potentially triggering an altcoin season.
Top Performing Cryptos of the Week
Pepe, Lido Finance (LDO), Uniswap (UNI), and Pendle Finance (PENDLE) were last week’s top performers.
- Pepe and Lido Finance benefited from Ethereum ETF approvals, with speculative bets on ETH driving their prices up.
- Despite facing significant resistance, Uniswap’s pump was linked to its SEC response and mobile app updates.
- Pendle Finance saw increased activity due to the overall positive sentiment around Ethereum, painting a potential bull flag or double top on its charts.
