Spot Ethereum ETFs approved, Reps pass FIT21 bill, Bitcoin reclaims $71k | Weekly Recap

May 26, 2024 at 2:03 pm

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Spot Ethereum ETFs approved, Reps pass FIT21 bill, Bitcoin reclaims $71k | Weekly Recap

Today’s edition of the weekly recap: U.S. regulators approve eight issuers of spot Ethereum (ETH) exchange-traded funds (ETFs) after an elongated wait period; Bitcoin (BTC) reclaimed the $71,000 threshold; lawmakers passed the FIT21 bill to ensure crypto regulatory clarity.

Discussions about spot Ethereum ETFs

Co-founder of Matrixport Daniel Yan suggested that if the U.S. Securities and Exchange Commission (SEC) approved the spot Ethereum ETFs, a Solana ETF could be next in line.
Bloomberg ETF analyst James Seyffart echoed these sentiments. According to Seyffart, the Solana ETF could record more demand than other crypto assets besides BTC and ETH.
A bipartisan group of U.S. lawmakers directed a letter to SEC Chair Gary Gensler, urging him to approve the spot Ethereum ETF filings on his desk.
QCP Capital, a leading crypto trading resource, asserted that such an approval could bolster Ethereum price growth. They predicted a potential 60% price spike to $6,000.

And then…

The SEC approved the 19b-4 filings from BlackRock, Fidelity, Grayscale, Bitwise, VanEck, Ark, Invesco Galaxy and Franklin Templeton. The firms submitted their adjusted forms to remove staking from their products.
The issuers must get their S-1 registrations approved before trading can go live. This process is expected to take weeks to months.
After approval, some industry experts argued that although the decision might clarify Ethereum’s regulatory status as a non-security, it could make ETH tokens held in funds unproductive compared to their use in staking or powering smart contracts.
Standard Chartered’s Crypto Research Head Geoffrey Kendrick suggested that XRP, alongside Solana, could see an ETF product next year following the approval of the Ethereum products.

Other developments

Meanwhile, spot Bitcoin ETFs recorded another week of straight inflows. They saw a cumulative $1.056 billion capital inflow last week, with the largest intraday influx being $305 million on May 21.
On May 22, leading asset manager WisdomTree announced that the London Stock Exchange (LSE) had approved its launch of crypto ETPs physically backed by Bitcoin and Ethereum. This decision preceded the departures of the LSE’s key team members

Bitcoin reclaims $71k

The crypto market saw a resurgence last week, but prices immediately pulled back. On May 20, Bitcoin spiked to a one-month high of $71,500. The premier crypto reclaimed $70,000 and $71,000 in one fell sweep for the first time in six weeks.
Bitcoin’s rally reverberated across the broader market, with multiple altcoins witnessing similar price upswings. The rally resulted in the broader crypto DeFi TVL hitting a 2-year high of $105.6 billion.
Some analysts cited the inflows into spot Bitcoin ETFs as major catalysts for the rally. Others pointed to bullish sentiments surrounding the anticipated approval of spot Ethereum ETFs.
Ethereum recorded the largest upsurge on May 20, closing the day with a massive 19% rise, its biggest intraday gain this cycle. While BTC and other assets retraced some of their gains, ETH merely consolidated.
Analysts project that the approval of the spot Ethereum ETFs could bolster Ethereum’s chances of hitting $5,000 — a new all-time high. Meanwhile, Pepe (PEPE) secured a new ATH for the second week in a row, when its price rose to $0.00001577 on May 25. PEPE is up 136% this month.

Trump tries to woo crypto enthusiasts

Republican presidential candidate Donald Trump began accepting donations in cryptocurrency in another effort to woo the crypto community.
On May 23, the U.S. House of Representatives passed a bill prohibiting the Federal Reserve from creating a dollar-backed Central Bank Digital Currency (CBDC).

FIT21 bill approved

The Financial Innovation and Technology for the 21st Century Act (FIT21) bill also made headlines. SEC Chair Gensler released a statement condemning the provisions of the bill. According to him, it could create a loophole for crypto firms to evade oversight.
The Biden administration also voiced concerns about the bill, citing the lack of “sufficient protection for consumers and investors” in its present form. However, the Biden administration expressed willingness to work with Congress for crypto regulatory clarity.
Despite these concerns, the House of Representatives voted overwhelmingly in favor of the FIT21 bill. Following this move, the bill will move to the Senate for further scrutiny.
Meanwhile, Coinbase disclosed that it had resumed XRP trading in New York after discussions with the authorities. Uniswap responded to the SEC’s Wells Notice, affirming its willingness to fight the agency if it litigates.

Crypto celebrates Bitcoin Pizza Day; Kabosu passes

On May 22, the broader crypto community celebrated Bitcoin Pizza Day, marking the day Bitcoin was first used for a real-world purchase. A report last week confirmed that crypto proponents had purchased $135,000 worth of Pizza with crypto over the past 12 months.
However, the Bitcoin community criticized Coinbase for its unconventional celebratory effort. The American exchange announced sales of Pizza using just USDC, with no option for Bitcoin payments, attracting backlash.
Meanwhile, the crypto meme coin community was thrown into mourning on May 24 following the passing of Kabosu, the Shiba Inu dog that inspired the meme on which Dogecoin, the original meme coin, was built.