The positivity in the market is clear and is most evident in the price of Bitcoin, which is approaching the record level it achieved earlier at the level of $73,000.
The positivity and upward momentum in the crypto market came indirectly as a result of increased expectations of the approaching approval of the Ethereum ETF from the SEC, as the latter is working to accelerate the review and required steps.
Crypto market and rapid changes:
Last May, the crypto community refused to classify Ethereum as a security, but speculation about the SEC’s approval of an Ethereum ETF changed the equation.
This speculation saw the price of Bitcoin rise to over $70,000, while the price of Ethereum rose significantly to exceed $3,500.
The odds of the Ethereum ETF being approved have increased dramatically, with Bloomberg analysts Eric Balchunas and James Seyphart raising their probability estimates from 25% to 75% in the last hour.
The impact of ETF on the price of Ethereum and alternative digital currencies:
The SEC approval of the Ethereum ETF is an event that has a significant impact on the price of Ethereum.
Although Bitcoin has a market cap of $1.3 trillion, Ethereum's market cap is only $440 billion, making it easier for Ethereum to see its price rise.
In addition, the amount of Ethereum available on exchanges is very low, reaching an all-time low of only 9.9% of the total supply.
Unlike Bitcoin, Ethereum does not have miners adding supply to the market.
Since the Ethereum network transitioned to a proof-of-stake mechanism, the coin has become deflationary, leading to a reduction in supply.
Many individuals hold Ethereum in various ways, such as storing, staking, or using it as collateral or for decentralized finance (DeFi) purposes.
Limited impact of Ethereum and increased demand:
Due to these factors, potential demand from traditional finance investors could result in them purchasing a small amount of available Ethereum.
Even if the inflows into ETH are not massive, they will still have a significant impact on its price.
Additionally, the approval of ETFs and rising Ethereum prices could lead to a significant increase in the value of altcoins.
Cryptocurrencies such as Solana, Avalanche, and several other tier 2 altcoins may see a significant rally in the coming days.
The SEC's approval of the Ethereum ETF is a pivotal event that could push the cryptocurrency market to new heights.
