Ethereum price has surpassed the $2,400 level for the first time since May 2022, turning investors’ attention to the possibility of an Ethereum exchange-traded fund (ETF) following the approval of spot Bitcoin ETF applications. After opening at $2,343 on January 10, Ethereum’s price saw a sharp increase, rising over 7.8% in the last 24 hours and 85% over the last 12 months, reaching $2,477.
Why Is Ethereum Rising?
Ethereum experienced a notable increase following a false tweet from the SEC’s official account regarding spot Bitcoin ETF approvals. As a result, while Bitcoin faced selling pressure, Ethereum’s price rose, making it the only non-stablecoin asset in the top 10 cryptocurrencies by market value. Ethereum last traded above $2,400 on May 3, 2022, and before falling below $1,000 on July 18, 2022, following the Terra Luna collapse, it had reached $2,529.
During this period, popular Layer-2 projects saw their native tokens increase in value, with Mantle network’s MNT gaining 9% and Optimism network’s OP achieving a 15% increase. These networks are built on top of the Ethereum network but operate as independent blockchain ecosystems, allowing users to transact much faster and cheaper than on the main blockchain network.
The Ethereum ETF Process May Begin
Crypto analysts on social media platform X suggest that market participants are preparing for a spot Ethereum ETF approval and claim that institutional investors in the US are indirectly investing in Ethereum. Michaël van de Poppe, CEO and Founder of MN Trading, stated in a post on X:
“The current momentum is surrounding Bitcoin and the ETF approval, but Ethereum could also get a spot ETF.”
Data from the blockchain data analysis platform Coinglass indicates that short position liquidations in the Ethereum futures market have reached $31.7 million in the last 24 hours, and the amount of liquidations is still increasing at the time of writing.
With all these developments, the SEC is expected to make its decision on all spot Bitcoin ETF applications on the night of January 11. Market participants are particularly confident that approval will come soon after Cboe reported the approved securities listings of several asset managers on January 10.
