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| ETH Price Soars 20%, Arbitrage and Optimism Are Also Dragged |
The Ethereum (ETH) ecosystem just received a huge boost, with speculations circulating regarding the potential approval of a spot Ethereum ETF.
This speculation has resulted in price hikes throughout the day, with the price of ETH rising 20% in a single day. around the time of writing, ETH ETH was trading around $3,617, close to the $3,700 level.
Decrypt Decrypt said that the rise had a good influence on its layer two network tokens, Arbitrum (ARB) and Optimism (OP), which both increased by 18%.
Optimism Across Markets
The positive feeling rippled across the crypto market, impacting other major coins. Solana (SOL) and Avalanche (AVAX) also saw large advances, with SOL hitting more than US$40 and AVAX reaching US$188. Both cryptocurrencies have risen by more than 25% in the previous seven days.
This unexpected increase was caused by expectations from two Bloomberg ETF experts, Eric Balchunas and James Seyffart. They proposed that the US SEC reconsider its position on this political issue and allow a spot Ethereum ETF.
Analysts increased their estimate of approval prospects to 75 percent, up from 25 percent previously. Earlier this year, other analysts rated his odds 50/50.
Balchunas and Seyffart predictions have a substantial effect on market mood. On Polymarket, a prominent betting site, the chance of a spot Ethereum ETF approval before the end of the month increased from 10% to 61%.
This contrasts sharply with the drop in optimism since January, when betting options initially surfaced with a 76 percent chance following the creation of a Bitcoin ETF.
History of ETF Approval by the SEC
The SEC has a history of delaying rulings on cryptocurrency ETF, primarily BitcoinBitcoin and now Ethereum. Many investors are concerned that this week deadline would prompt the SEC to deem Ethereum a security, removing it from the commodity status enjoyed by Bitcoin.
Such a judgment might have serious regulatory consequences for Ethereum and its ecosystem.
Political Influence on Crypto Policy.
The debate surrounding spot Ethereum ETF has also caught the attention of lawmakers. Last week, a debate on Capitol Hill saw many Democrats join Republicans in opposing President Joe Biden pro-SEC stance.
This bipartisan conflict over US crypto policy highlights the growing political interest and influence over the future of digital assets.
