The Ethereum price has been dealing with a lot of ups and downs over the past couple of years under the influence of both internal and external pressures. The fact that regulators have been adamant about bringing more order and rules to the environment wasn’t seen as a positive thing by the majority of investors, who value decentralization as a core tenet of the blockchain. However, according to Binance data, 2024 is set to be a positive year for the cryptocurrency markets, with considerable gains expected to elevate the prices.
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Price rally
Ethereum managed to break through the price resistance at $2,400 for the first time since May 2022. At the time, ETH was still faring quite well, as the tremendous losses that marred the crypto environment during that year were yet to arrive. The seemingly sudden growth didn’t actually come out of the blue but is, in fact, a direct result of the recent approval of a Bitcoin ETF. Investors had been eagerly anticipating this moment for several months and had to put up with several delays in the meantime.
On January 10th, when the SEC made the official announcement, the price climbed by about 8% in the span of twenty-four hours. This was an 85% climb compared to the levels of the past twelve months. It therefore managed to climb to a year-to-date high of $2,444. Just a day before, on January 9th, the Securities and Exchange Commission was at the center of a controversy after its Twitter account was compromised. The attacker posted a single, incorrect tweet that claimed ETFs had already been approved.
Ethereum was the only non-stablecoin in the top 10 cryptos that immediately showed a bullish tendency following the tweet. The fake news also caused price volatility for Bitcoin, leading to oscillations in the price. Some of the tokens associated with layer 2, including MNT and OP, gained 9% and 15, respectively. The networks are built as independent networks that allow investors to carry out transactions faster and for a lower price than on the main blockchain.
Ethereum ETF
The changes in the marketplace suggest that users are already getting ready for the arrival of an Ethereum ETF. While the SEC is notorious for its long waiting times and delays, it has already agreed to Ether being considered a commodity. While there was never any official announcement, the Commission implicitly accepted Ether as such by approving futures ETFs that are backed by Ethereum last year.
This has caused a lot of excitement and no small amount of apprehension within the community, as investors expect an official announcement to be made soon. Investors are divided on whether May or August is the most likely date. Given the approval of the Bitcoin ETFs, the necessary infrastructure will already be set in place for the arrival of ETH exchange-traded funds. However, other investors are a little more reserved in their estimations, saying that the regulators are well-known for the fact that they’re not known for delivering swift answers.
Eleven spot BTC ETFs were approved on January 10th, which caused widespread optimism for Ethereum investors. The most recent data shows that analysts believe there’s a 70% chance that investors will get a favorable answer around May. The general consensus is that the ETH spot will follow right behind the Bitcoin spot. This isn’t a surprise, considering the fact that the two cryptos are linked to each other. Their prices have always been in sync, with only a few exceptions here and there. Others believe it will take a little longer than most people expect, but the approval is still a certainty. In this scenario, the SEC might consider adopting a different modus operandi that allows it to be more discreet about which assets it will enable on the market.
20%
On January 12th, data showed that Ethereum managed to gain 20% compared to Bitcoin over the past seventy-two hours. This was a noteworthy announcement given that the Bitcoin ETF approval was expected to propel BTC to new heights first before having a prominent impact on the altcoins. Instead, BTC recorded a momentary downswing that, although small, was still unexpected. As a result, ETH/BTC climbed from yearly lows of 0.0478 to 0.0587.
The ETH/USD is breaking out as well, with levels absent from the chart in the past year and a half. In this sense, ETH joined other large-cap tokens in surpassing Bitcoin’s returns over the week despite the launch of the ETFs. So, what about Bitcoin’s dominance? The king of crypto, also known as digital gold and widely recognized as the uncontested ruler of the crypto space, isn’t likely to ever be surpassed by altcoins. However, there’s no denying the momentum Ethereum is seeing.
This could be part of a cycle that records more dominance from the altcoins. It’s important to remember that the Bitcoin halving is still expected in April, and the attention might focus on it again when the time comes. The halving is known as a price upswing catalyst, although the effects are not immediate. It will take anywhere between six and twelve months to see price growth, but the change is expected to be significant.
Investors believe that in 2025, Bitcoin could trade for at least $80,000 and might even succeed in climbing to the $100,000 level, an event that would make history for BTC. As institutions and retailers look to gain exposure to Bitcoin over the long term to gain value, a major supply squeeze could arrive, changing things even further.
To sum up, the cryptocurrency market is expected to continue growing in 2024. This is in line with historical trends since anytime losses occur, growth is set to arrive in the aftermath as well. At the same time, after considerable, sustained growth after a long time, it’s essential to be mindful of the price corrections. Further announcements regarding the approval of more ETFs and the Bitcoin halving will undoubtedly impact the market, and it’s essential to navigate the environment carefully. Doing so is the best way to ensure the well-being of your portfolio.
