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The SEC green light for the spot ETF on Bitcoin inflames other cryptocurrencies. Ether, the second-largest cryptocurrency, has emerged as one of the biggest beneficiaries of US regulators’ decision to approve the first traded funds.
Ether rose 9% in the past 24 hours to $2,585 as of 7.11am on Thursday in London – a 20-month high – while Bitcoin remained little changed at $46,070 after a jump of more than 160% over the past year.
The trader’s bet
The disparity suggests that traders are betting that ETFs that invest directly in Ether will be next to get the green light from the U.S. Securities and Exchange Commission, and that the token has yet to reflect that prospect.
By contrast, Bitcoin has already seen a months-long surge in optimism that approval for ETFs that invest directly in the largest digital asset was on the way. This has led to speculation that the rally may be close to exhaustion for now. “With its size, liquidity and existing CME futures, Ether has the attributes, using the now successful Bitcoin model, that make a U.S. physical ETF viable,” said Richard Galvin, co-founder of crypto asset manager DACM based in Sydney.
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Speculations compared
Ether is the token of Ethereum, the most commercially important blockchain in the cryptocurrency sector. Investors can earn rewards by pledging Ether tokens to help manage the blockchain, a process called staking.