In a groundbreaking move, the US Securities and Exchange Commission (SEC) approved a series of spot Bitcoin exchange-traded funds (ETFs) on January 10, sending ripples into the cryptocurrency market. While Bitcoin’s reaction was subdued, altcoins came into the spotlight and experienced a surge that many are now calling the beginning of “altcoin season.” Meanwhile, the approval of Bitcoin spot ETFs has set the stage for the potential approval of spot Ether ETFs in 2024; analysts are predicting a clear path and even predicting a 70% chance of approval by May.
Altcoin rallies begin
Despite the expectation that the SEC would approve spot Bitcoin ETFs, Bitcoin’s reaction was weak and a small price move towards $47,600 quickly retreated. Analysts had predicted that the news was already priced in and that the confirmation turned into a potential news sell-off. But the unexpected result was that many cryptocurrencies experienced double-digit swings, sparking what is now referred to as “altcoin season.”
Total crypto market capitalization reached a 21-month high of $1.85 trillion, mainly thanks to the impressive performance of altcoins. Ethereum, which was previously thought to be underperforming, reached its highest price since May 2022, with a significant increase of 10% to $2,583. Other winners in the altcoin space include Cardano (ADA), Avalanche (AVAX), Polkadot (DOT), Chainlink (LINK). Additionally, Polygon (MATIC), Uniswap (UNI), Ethereum Classic (ETC), Optimism (OP), Near Protocol (NEAR), Filecoin (FIL), Arbitrum (ARB) and Immutable (IMX) are rising.
Ethereum ETF may be on the horizon
With the successful approval of spot Bitcoin ETFs, attention has now turned to the potential approval of spot Ether ETFs. Analysts including Bloomberg’s Eric Balchunas predict a clear path for Ether ETFs, with a 70% chance of approval by May. The correlation between the Bitcoin and Ether markets is highlighted, as the approval of Spot Ether ETFs is seen as a logical step following the approval of Bitcoin ETFs.
Crypto asset lawyer Joe Carlasare also supports the idea of spot Ether ETF approval in 2024, although it may have a slightly longer timeline than some had anticipated. Carlasare suggests that the SEC aims to set a precedent that allows discretion in approving digital asset ETFs and discourages an influx of applications for every major token. The price of Ether increased by around 3% following approvals, rising above $2,500 for the first time since May 2022.
As the cryptocurrency market witnesses the start of ‘altcoin season’ and awaits the potential approval of spot Ether ETFs, the regulatory environment continues to evolve. Investors and enthusiasts are watching these developments carefully. They also expect more changes and opportunities in the dynamic world of cryptocurrencies.
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