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The crypto community is discussing the chances to see the spot ETH ETF applications approved in May 2024.
In the aftermath of the recent approval of a spot Bitcoin exchange-traded fund (ETF) in the US, major cryptocurrencies, Ethereum included, witnessed a significant rally.
While Bitcoin (BTC) saw a modest 1.35% gain, Ethereum (ETH) emerged as the standout performer, surging by 10% to surpass $2,600, reaching its highest value since May 2022.
Analysts had expected a possible “sell-the-news” reaction to the ETF approval, anticipating BTC to reach a new all-time high. However, the leading crypto asset underperformed and maintained its $47,000 position attained on January 9 before the ETF approval.
Nevertheless, K33 Research senior analyst Vetle Lunde suggested that BTC’s price could see improvement with the deal flow on the ETF approval, hinting at a potential cycle pushing BTC’s price beyond $300,000.
Ethereum Breaks Resistance amidst Strategic Trading
While BTC maintained its $47,000 position, Ethereum broke the resistance, currently trading around $2,645 at the time of writing, signaling renewed interest among traders.
Conor Ryder, the head of Research at Ethena Labs, a stablecoin company, opined that traders are strategically accumulating the digital asset due to ETH’s comparatively lower price compared to many other tokens like BTC in anticipation for more developments within the ecosystem.
With ETH currently trading beyond $2,600, the crypto community hinted at the possibility of an Ethereum exchange-traded fund (ETF) approval. Last year, asset management companies such as VanEck, Ark Invest, and Hashdex submitted applications with the US Securities and Exchange Commission (SEC) for a spot Ethereum ETF product.
The financial watchdog is expected to make decisions regarding the applications in May 2024 and market analysts believe the SEC would approve the investment products in the coming months.
$272 Million Liquidated after Bitcoin ETF Approval
Meanwhile, the broader crypto market also witnessed positive movements, with the top 10 digital assets (excluding stablecoins) recording gains of more than 4% within 24 hours. Solana, (SOL) Cardano (ADA), Binance Coin (BNB) Avalanche (AVAX) Ripple (XRP), and Dogecoin (DOGE) showed increases ranging from 4% to 14% upon the BTC spot ETF approval.
However, the surge in crypto prices led to significant liquidations, totaling approximately $272 million across more than 85,000 traders.
Bitcoin traders incurred losses of nearly $85 million, with ETH’s price surge resulting in significant losses for short traders, amounting to $54 million. Long traders for Ethereum faced approximately $30 million in losses.
Notably, a $3.81 million short position against Ethereum on Binance marked the most substantial liquidation. Other assets like SOL, XRP, and BNB also saw notable liquidations.
Binance and OKX emerged as the platforms with the highest total losses, accounting for more than $190 million at press time.
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