Right after Ethereum experienced a surge on August 29, a large investor purchased 8,000 ETH at a price of $1,709, investing a total of 13.66 million USDC. As of the time of writing, the value of ETH continues to climb, with its trading price hovering around $1,740.
There is potential for further price increases in the upcoming trading sessions due to a shift in trader sentiment following a positive appellate court decision in the legal battle between Grayscale, the issuer of various trusts including the Bitcoin Trust, and the United States Securities and Exchange Commission (SEC).
The Key Factor from Grayscale
The Court of Appeals for the District of Columbia in the United States criticized the SEC for not permitting Grayscale to convert the substantial amount of over-the-counter (OTC) Bitcoin Trust into a Bitcoin spot Exchange-Traded Fund (ETF). While the SEC has already given the green light to a Bitcoin Futures ETF that doesn't directly mirror Bitcoin's price movement.
Grayscale argues that the measures implemented to ensure the accuracy of aggregated prices for the Bitcoin index, used as a basis for the Bitcoin Futures ETF, are secure. Therefore, these same measures could ensure the reliability of data streams used for a Bitcoin spot ETF.
Grayscale further emphasizes that their surveillance sharing agreements with the Chicago Mercantile Exchange (CME) should effectively detect and eliminate any attempts to manipulate Bitcoin prices.
Will the SEC Approve an Ethereum Futures ETF?
Following this development, it's probable that the SEC will grant approval for a Bitcoin spot ETF in the upcoming months. However, this is not guaranteed, as the asset management company still needs to navigate a process overseen by the regulatory body.
It's important to note that this DOES NOT automatically imply that GBTC will instantly transform into an ETF. It merely indicates — as the court pointed out — that the SEC didn't adequately explain why it authorized Bitcoin futures ETPs but not Grayscale's proposed product.
Progress lies ahead...
Meanwhile, several firms have submitted applications for an Ethereum futures ETF. By early August, six entities, including Bitwise, VanEck, and Grayscale, had expressed their intention to offer these products to investors. Nevertheless, the SEC has not yet granted approval for any Ethereum futures ETF.
It remains uncertain whether the SEC will decide to allow trading of an Ethereum derivative in the current year. However, if the regulator approves all applications and gives the go-ahead based on their submission dates, the Volatility Shares Ethereum futures ETF could potentially become available as early as October 12.
At present, Bitcoin's price is on an upward trajectory after finding support at approximately $25,800. This uptrend in BTC prices has had a positive impact on altcoins, with Ethereum showing strength and breaking out. Analyzing the candlestick pattern on the daily chart, ETH prices have breached the resistance level of $1,700 from the previous week.
The price surge of ETH as of August 29 is accompanied by increased trading volumes, and the breakout bar is notably extensive. This could suggest that there is active engagement from ETH buyers, potentially driving the coin's value even higher in the coming days. Considering the price action, the significant investor purchased ETH around the breakout point of $1,700 and is currently in a profitable position.
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Topic: The United States District of Columbia Court of Appeals faulted the SEC (Read 961 times)