Why is the Bitcoin ETF Approval So Important for Ethereum?
January 10th, 2024 was a big day for Bitcoin and the rest of the cryptocurrency market for that matter. Getting to this point wasn’t easy, of course. It never is when it comes to crypto.
For instance, around 24 hours before the approval had been finalised, a tweet from the Securities and Exchange Commission account announced that the long-awaited ETFs had finally been approved, leading to a BTC spike of more than $1,000. Not long after, the SEC then announced that its account had been hacked, and the tweet was false. If the Bitcoin investors hadn’t been sweating before, they were certainly sweating then!
Good News for Bitcoin
But of course, they didn’t need to, because 24 hours later, the SEC gave the green light to as many as 11 Bitcoin ETFs to be traded in the US, opening the door to potentially thousands of investors who would rather invest in an exchange-traded fund rather than buy actual BTC. In response, the price of BTC increased by a substantial 2.1% to hit $47,000, with the crypto market as a whole seeing a positive swing – check Cryptosoho for up-to-date prices.
But while this is obviously a win for Bitcoin, it is just as much a win for Ethereum, which is the second most popular coin in the crypto market. Like Bitcoin, Ethereum saw an increase of around 5% to $2,637, with other cryptocurrencies in the Ethereum ecosystem rising too – Polygon saw a 13% increase, Chainlink saw 11%, and Uniswap saw 14%. And these numbers are only set to increase even more over the next few months.
Why is the ETF Approval Good for Ethereum?
After the success of Ethereum’s merge, investors have been awaiting the next narrative. In a way, the Bitcoin ETF approval may have provided that. Although it is the second largest coin in the world, ETH is still an affordable option for most traders, meaning traders can strategically position themselves for Ethereum’s own search for ETF approval – and at a far lower cost than they could for Bitcoin.
The approval in question also seems like a far more surer thing than it did for Bitcoin. Because there was uneasiness about whether the SEC would approve; many traders were holding back on investing, which made the eventual surge relatively subdued to what it could have been. Now that it has been approved, however, Ethereum seems to have a straight shot at their own approval; which could lead to a gradual building of interest in the lead-up to May 2024; – when the SEC is slated to make decisions on spot Ethereum ETF applications.
Investing in Ethereum in 2024
If you’re looking for your next investment, then Ethereum could be a good avenue to look at. As mentioned before, the ETF approval seems positive, and apart from this; the interest in Ethereum’s crypto apps seems set to spike. With Bitcoin ETFs approved, there is likely to be even more institutional interest in the crypto landscape; and a lot of them will flock to Ethereum due to the unique and blossoming network that it has created.
In 2023, the cash flow into Ethereum hit around $2.3 billion; and many experts are expecting this to double in 2024. Of course, nothing in cryptocurrency is a given; and it’s crucial that you read as many guides and reviews as you can before making big decisions. You also need to nail your crypto trading strategies and choose options that support your own risk-taking tendencies. But for both BTC and ETH, it appears that the year 2024 could not have started any stronger.
