Markets
Ether Slides After SEC Opens Door to Ether ETFs, Still Heading for Best Week in Over a Year
Nikos Pekiaridis | Nuphoto | Getty Images
Ether slipped Friday even after the Securities and Exchange Commission approved a rule change this will pave the way for exchange-traded funds to buy and hold the cryptocurrency.
The price of ether fell more than 2% to around $3,699.50, according to Coin Metrics. He maintains his weekly gain of 20% and is on pace to have his best week in over a year.
“Current market behavior looks more like a pause as investors digest recent gains and assess the impact of external economic factors, including the recent rate cut,” said Rachel Lin, CEO and co-founder of the decentralized derivatives trading platform SynFutures. “This pause likely also reflects a cautious approach given continued uncertainty regarding the timing of regulatory approvals, such as S-1 filings.”
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ETH ETF approvals were integrated earlier in the week
In the meantime, Coinbasea potential beneficiary of ether ETFsclimbed more than 8%, while Robin Hood added 4%.
Although both companies offer cryptocurrency trading, Coinbase could benefit more from the introduction of Ether ETFs as it offers a host of other crypto services including custody and staking, as well as a larger selection of marketable assets. Coinbase also operates a blockchain called Base, built on the Ethereum network.
Ether’s tepid price action could be because investors are quickly internalizing the SEC approval earlier this week. The room jumped more than 20% over two daysas expectations for SEC approval of ether ETF applications changed abruptly.
The previous consensus was that the agency was unlikely to green light the new funds, due to the agency’s lack of engagement on the files. In contrast, in the weeks leading up to the approval of Bitcoin ETFs, the SEC reportedly actively collaborated with fund issuers.
Alex Saleh, head of partnerships at blockchain protection company Coincover, also noted that it is still unclear when the new products will hit the market or which players will participate.
“This uncertainty makes it difficult to predict any changes in demand that would lead to new price discoveries,” he said. “Calls from major industry players that this confirms ether’s status as a commodity also introduces more uncertainty into the market, with many investors waiting to see the regulatory outcome of the commodities versus securities debate .”