Ethereum has shed a significant part of its supply since the London upgrade, applied in August 2021. According to ultrasound.money, a portal that records several statistics associated with the ETH burn, over 4 million ether (3.2%) have been removed from the network since the adoption of EIP-1559, which changed how fees are calculated. EIP-1559 Burns […]
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Welcome back to Distributed Ledger. This is Frances Yue, crypto and markets reporter at MarketWatch.
It’s a big day for the crypto industry. The U.S. Securities and Exchange Commission greenlighted several spot bitcoin
BTCUSD,
exchange-traded funds (ETF) for the first time on Wednesday, paving the way for a new class of investors to gain exposure to the virtual currency that could serve as a tailwind for price of the world’s most popular digital asset.
We’ve written about the implications for the crypto space here, including why a spot bitcoin ETF is a new wrinkle in the market.
Find me on X at @FrancesYue_ to share any thoughts on crypto or this newsletter.
Bitcoin is up 0.8% over the past 24 hours to around $45,984 on Wednesday, while ether rallied 7.9% over the same period to around $2,507, according to CoinDesk data.
The approval of bitcoin ETFs was already priced in, said Mark Connors, director of research at 3iQ. The bitcoin ETFs are due to start trading on Thursday.
Investors are already looking past the bitcoin ETF approvals and looking forward to the potential approval of an ether ETF down the road, said Connors in a call.
Although, such expectations may be premature.
Investors will be closely watching initial flows for bitcoin ETFs within the first 24 to 48 hours, after they started trading on Thursday.
The Proshares Bitcoin Strategy ETF
BITO,
the first bitcoin futures ETF that was launched in October 2021, garnered $1 billion in its first two days, according to Anthony Rousseau, head of brokerage solutions at TradeStation.
That compares with the SPDR S&P 500 ETF
SPY,
which reportedly raked in $20.8 billion on a single day in December.
We’ve previously written that the market has been pricing in roughly $1 to $2 billion initial inflows into the spot bitcoin ETFs.
“It’s essential to exercise caution and consider that immediate flows may largely comprise early adopters, primarily retail investors,” according to Rousseau at TradeStation.
“This could potentially entail recycled money, possibly falling short of the lofty expectations,” Rousseau said.
Rousseau said the crypto market may be prone to overestimation about the impact of the new ETFs in the short term, but may have underestimated their long-term implications for bitcoin.
The ETFs may unlock access to bitcoin for more investors, and even if a small percentage of over $100 trillion global assets managed by financial institutions is allocated to bitcoin, it could significantly drive up the crypto’s price. The factor is not yet fully reflected in bitcoin’s current valuations, noted Rousseau.
“It’s crucial to recognize that institutions can follow due process and navigate regulatory hoops to incorporate Bitcoin into their investment strategies, a journey that could span several months,” Rousseau said.
Investors also will watch fees of bitcoin ETFs by different issuers and whether they will trade at a premium or a discount to their net-asset value, according to James Harte, analyst at Tickmill Group.
Traders should be watching out for bitcoin’s potential downside levels of $43,015 and $40,345, according to James Harte, analyst at Tickmill Group.
Meanwhile, the crypto faces a top-side resistance of about $48,350, noted Harte.
Bitcoin rose 6.1% in the past seven days and ether gained about 7.2%, according to CoinDesk data.
BlackRock has joined the Ethereum Spot ETF race as the asset management company has officially applied to the US SEC and is currently waiting for approval.
Following its Spot Bitcoin ETF filing, BlackRock, an American investment company has taken the proactive step by filing an Ethereum Spot Exchange Traded Fund (ETF) with the United States Securities and Exchange Commission (SEC).
The asset management company submitted the application on November 15, however, BlackRock has stated it formed the Trust as early as November 9.
According to BlackRock, the iShares Ethereum Trust would be used to facilitate the ownership of Ether through the issuance of shares, allowing investors to own a fractional undivided beneficial interest in the net assets of the Trust.
“The Trust was formed as a Delaware statutory trust on November 9, 2023. The purpose of the Trust is to own ether transferred to the Trust in exchange for Shares issued by the Trust. Each Share represents a fractional undivided beneficial interest in the net assets of the Trust. The assets of the Trust consist primarily of ether held by the Ether Custodian on behalf of the Trust,” BlackRock said in its filing.
Presently, the US SEC has not approved any Ethereum Spot ETF filing as well as Spot Bitcoin ETF applications. The regulatory body has delayed multiple applications to be reviewed from January 2024.
The crypto community has remained enthusiastic that the regulatory agency would eventually approve the pending ETF applications, as this could significantly push the growth and development of the crypto ecosystem as well as the cryptocurrencies involved.
The price of Ethereum is on the rise following BlackRock’s Ethereum ETF filing. The cryptocurrency’s price climbed almost 2% moving to $2,080 at some point following the announcement of the filing.
The sharp reaction has caused a stir in the cryptocurrency community, as investors gear up for a potential bull run if the US SEC gives its official authorization of Ethereum Spot ETFs.
The price of Bitcoin has also been growing steadily as new companies apply for Spot Bitcoin ETFs. Currently, Bitcoin’s price is trading at $36,408, while ETH is down from its initial surge and trading at $1,952.
The crypto ecosystem is presently watching closely for more updates on the US SEC’s ETF filing approvals and the price changes that follow them.
ETH price falls to $1,945 | Source: ETHUSD on Tradingview.com
Featured image from Bitcoin News, chart from Tradingview.com
A single scammer has reportedly managed to steal around $385,000 worth of Ether (ETH) in less than 24 hours amid a scourge of SIM-swap hacks seemingly targeting Friend.tech users.
On Oct. 5, blockchain sleuth ZachXBT reported the same scammer had pilfered 234 ETH over the past 24 hours by SIM-swapping four different Friend.tech users.
The on-chain movement of crypto assets was traced back to the same hacker who drained the accounts of the four victims.
The same scammer profited $385K (234 ETH) in the past 24 hours off SIM swapping four different FriendTech users. pic.twitter.com/03BoBEqGax
— ZachXBT (@zachxbt) October 4, 2023
One of the reported victims of the most recent chain of SIM-swap attacks posted to X (Twitter) following the attack:
“Got sim swapped. Apparently, dude was able to do it from an Apple store and switched it to an iPhone SE. Don’t buy my keys, that wallet is compromised.”
X user “KingMgugga” reported an attack targeting them happening in real time, posting to X that they were “getting f—ing sim swapped watching it happen” and asking for help. Meanwhile, another X user, “holycryptoroni,” confirmed they were similarly attacked, lamenting, “I got swapped sorry.”
Earlier this week, a further four Friend.tech users claimed to have their accounts drained as a result of a SIM-swap or phishing attack, totaling around 109 ETH stolen.
I was just SIM swapped and robbed of 22 ETH via @friendtech
The 34 of my own keys that I owned were sold, rugging anyone who held my key, all the other keys I owned were sold, and the rest of the ETH in my wallet was drained.
If your Twitter account is doxxed to your real… pic.twitter.com/5wA86mjYEG
— daren (friend, friend) (@darengb) October 3, 2023
Friend.tech allows users to purchase “keys” of individuals, which grants access to private chat rooms with them.
The SIM-swap scam occurs when scammers gain access to the victim’s phone number and use it to acquire authentication, which enables them to access their social media and crypto accounts.
Manifold Trading, a firm building tools for the ecosystem, estimated that $20 million of Friend.tech’s $50 million of total value locked could be at risk. It called for the platform to beef up its account security measures by enabling two-factor authentication (2FA).
Related: How easy is a SIM swap attack? Here’s how to prevent one
There have also been calls for X to implement 2FA security measures to prevent mobile phone numbers from getting leaked following the high-profile hack of Vitalik Buterin’s account in September, which was also due to a SIM swap attack.
“0xfoobar,” founder and CEO of wallet security firm Delegate, advised removing phone numbers from social media accounts.
crypto twitter is like a neighborhood where once a day somebody leaves their front door open, gets robbed, and everybody comes together to lament the loss, leaving their own front doors open. instead of retweeting the 75th simswap of the week go remove your phone from everything
— foobar (@0xfoobar) October 5, 2023
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Asset managers keep pursuing digital asset products, with Invesco and Galaxy Digital allegedly filing for a spot Ether (ETH) exchange-traded fund (ETF) on Sept. 29.
Bloomberg ETF analyst James Seyffart disclosed the filing on X (formerly Twitter), even though the application hadn’t been uploaded to the SEC’s public database at the time of writing.
Invesco Galaxy just filed for a spot Ether ETF, I think this is the 3rd of 4th one of these, have to check tho.. pic.twitter.com/SIJVu8VzFk
— Eric Balchunas (@EricBalchunas) September 29, 2023
A spokesperson for Invesco declined to confirm the application, stating that products still being registered cannot be commented on. Cointelegraph reached out to Galaxy but did not immediately receive a response.
With the Sept. 29 filing, Invesco and Galaxy join a growing line of investment managers seeking regulatory approval for a spot ETH ETF. On Sept. 27, the SEC delayed decisions on previous applications from ARK 21Shares and VanEck, extending the deadline until Dec. 25–26. “The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein,” said the SEC.
Although a spot Ether ETF may not be available for a while, futures-based Ether ETFs should be available as soon as next week. On Sept. 28, investment firms started gearing up to add ETH futures vehicles to their portfolios. VanEck, for instance, published a statement about its upcoming Ethereum Strategy ETF — tickered EFUT — which will be listed on the Chicago Board Options Exchange in the coming days.
Another company debuting a futures crypto ETF is Valkyrie. The asset manager will begin offering exposure to Ether futures through its existing Bitcoin Strategy ETF, now rebranded as Valkyrie Bitcoin and Ether Strategy ETF. A Valkyrie spokesperson told Cointelegraph that the firm’s Bitcoin Strategy ETF will allow investors access to Ether and Bitcoin (BTC) futures “under one wrapper.”
Likewise, Bitwise submitted an updated prospectus for their equal-weight Bitcoin and Ether futures ETF on Sept. 28, which is also expected to go live next week. According to Seyffart, Proshares also applied and Kelly ETFs partnered with Hashdex to deliver futures Ether ETFs in the coming days.
Ether is trading in the green at the time of writing at $1,666, driven by euphoria over the debut of futures ETFs.
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Asset management firm Valkyrie has said it will hold out for the United States Securities and Exchange Commission to approve an exchange-traded fund, or ETF, with exposure to Ether (ETH) futures rather than making purchases in advance.
In a Sept. 29 filing with the SEC, Valkyrie said it would not make certain purchases “until the effectiveness of an amendment” reflecting ETH futures contracts as the ETF’s principal investment strategy. The firm told Cointelegraph on Sept. 28 that it planned to allow investors exposure to Ether and Bitcoin (BTC) under a combined Bitcoin and Ether Strategy ETF, with purchases planned ahead of a launch the first week of October.
“The Fund will unwind any existing positions in ether futures contracts,” said the SEC filing.
The plot thickens, Valkyrie just put out 497 that they are in fact not going to buy Ether futures until they are live (prob Tue) and are going to sell the Eth futures they bought (in an effort to jump line a bit). SEC must have threatened them to cut it out. Damn. pic.twitter.com/cKaV7k7AJs
— Eric Balchunas (@EricBalchunas) September 29, 2023
Cointelegraph reached out to Valkyrie but did not receive a response at the time of publication. It’s unclear what may have led the firm to change its position in less than 24 hours. Valkyrie filed with the SEC to list an Ether futures ETF on the Nasdaq Stock Market in August, but the regulator has not reached a decision on a proposed rule change allowing the investment vehicle.
Related: Enter the Ether: VanEck releases two ETF ads ahead of possible Monday launch
Several ETFs offering exposure to Ether futures are expected to begin trading the first week of October, including ones from VanEck, Bitwise and ProShares. However, on Sept. 28, the SEC delayed its decision on a proposal for a spot BTC ETF from Valkyrie, as well as proposals from BlackRock, Invesco and Bitwise.
The delays came weeks ahead of scheduled ETF deadlines for the SEC, with many suggesting the regulator was acting in response to a potential shutdown of the U.S. government. Members of Congress have until Sept. 30 to present a bill funding the government into the next fiscal year for U.S. President Joe Biden to sign into law.
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Ethereum’s native token, Ether (ETH), is up today as traders assess a slew of positive updates from cryptocurrency and macro markets.
On Sep. 29, Ether’s price rose nearly 2.5% to $1,688, its highest level in a month.
The intraday gains came as a part of a broader upside move that started the previous day when asset manager Valkyrie gained regulatory approval to add Ethereum futures exposure to its existing Bitcoin Strategy ETF (BTF).
The news appeared alongside claims that the U.S. Securities and Exchange Commission (SEC) may approve “a bunch of Ethereum futures ETFs” for launch next week. That includes fifteen ETH futures ETFs from nine issuers awaiting approval.
Ethereum got an additional boost from the latest U.S. core personal consumption expenditures (PCE) data, also known as the Federal Reserve’s preferred inflation gauge.
Notably, the PCE rose 0.1% in August, lower than the market’s expectations of 0.2%. That helped take some air off from an otherwise rising U.S. bond yields, helping non-yielding assets like stocks and cryptocurrencies rise.
A cooling inflation indicates that Fed may keep its interest rates unchanged at the current 525-550 basis points (bps) range. CME’s Fed futures rate data shows a 87.5% possibility of a rate pause in the next Federal Open Market Committee’s (FOMC) meeting on Nov. 1.
Ethereum’s price gains on Sep. 29 also coincides with short liquidations worth $7.88 million across Ether-tied derivatives. In comparison, only $1.7 million worth of long positions were liquidated on the same day.
Short sellers liquidated their positions by buying the underlying asset. Therefore, the combination of new buyers and short liquidations pushed up the Ether price.
The Sep. 29 upside move in the Ethereum market has pushed the Ether price above its 50-day exponential moving average (50-day EMA; the red wave) near $1,770.
Flipping the 50-day EMA from resistance to support enables the ETH price to eye $1,740 in October 2023 as its next upside target. This level coincides with two key resistances: the 200-day EMA (the blue wave) and the 0.382 Fib line.
Related: SEC delays spot Bitcoin ETF decision for BlackRock, Invesco and Bitwise
In addition, the level is $20 shy of Ethereum’s falling wedge upside target, as shown below.
However, breaking below the 50-day EMA support raises Ether’s risks of falling toward the 0.5 Fib line near $1,610 in October, down about 3.75% from current price levels.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Grayscale’s decision to file for an Ether futures ETF comes on the heels of a significant legal victory against the US Securities and Exchange Commission (SEC).
Renowned crypto asset manager Grayscale Investments recently filed for a new Exchange-Traded Fund (ETF) that will track Ethereum (ETH) futures, as reported by the Wall Street Journal.
In its previous attempt to launch a crypto ETF, Grayscale filed under the Investment Company Act of 1940. This filing, while a significant step forward for the industry, faced regulatory hurdles and delays, a common theme in the crypto ETF space.
In the latest application, Grayscale’s pivot toward the Securities Act of 1933 demonstrates the company’s commitment to navigating regulatory challenges while catering to the surging demand for crypto investment options.
The Securities Act of 1933 primarily governs the issuance and sale of securities, providing a regulatory framework that is potentially more suitable for crypto futures ETFs. It allows for the registration of securities offerings, which aligns with the structure of ETFs, making it a potentially smoother process compared to the Investment Company Act of 1940.
Notably, ETFs have gained immense popularity as they provide investors with an accessible and regulated way to gain exposure to cryptocurrencies. These investment vehicles have gained traction among both retail and institutional investors who seek a more convenient way to enter the crypto market.
At least 12 candidates, including Volatility Shares, Bitwise, ProShares, VanEck, Roundhill, and Valkyrie Investments, have filed for Ethereum futures ETFs so far. The increasing number of applicants vying for approval indicates a strong market demand for such investment products. Market participants believe that, if approved, Ethereum futures ETFs could help further legitimize and institutionalize the crypto market.
Grayscale’s decision to file for an Ether futures ETF comes on the heels of a significant legal victory against the US Securities and Exchange Commission (SEC). In a recent ruling, a judge ordered the SEC to re-evaluate Grayscale’s proposal for a spot bitcoin ETF.
This ruling is seen as a positive development for the crypto industry, as it suggests that the SEC’s stringent stance on crypto-related ETFs may be subject to legal scrutiny and revision. The judge’s decision highlights the evolving nature of crypto regulation in the United States.
While the SEC has traditionally been cautious about approving crypto ETFs, the growing interest and demand from institutional investors and the broader public are compelling regulatory authorities to reconsider their approach.
Grayscale’s legal saga began in late 2021 when it filed an application with the SEC to convert its Grayscale Bitcoin Trust (GBTC) into a Bitcoin spot ETF. However, the SEC rejected Grayscale’s request in June 2022, citing concerns related to anti-fraud and investor protection requirements.
While Grayscale’s legal victory initially had a positive impact on the price of ETH, it’s essential to understand that crypto markets are highly volatile. In the immediate aftermath of the court’s ruling, ETH’s price surged above the $1,700 mark. However, the price rally proved short-lived as it retraced to around the $1,600 level.
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Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
The Bitcoin (BTC) and Ether (ETH) price slump on Aug. 18 saw the top two cryptocurrencies fall to a two-month low and triggered a series of liquidations for thousands of derivative traders.
The crypto bloodbath led to billions of dollars worth of hedged positions being liquidated and several traders lost millions of dollars in a single trade.
According to CoinGlass data, a total of 176,752 traders got liquidated over the past 24 hours. 90% of these liquidations took place within the last 12 hours, indicating a rapid rise in price volatility just days after BTC and ETH recorded their lowest daily volatility in several years.
Among the sea of traders who lost a significant chunk of their derivative positions, two particular liquidations caught the crypto community’s eye for the sheer scale of it. During the price slump, an investor on Binance’s ETHBUSD contract was liquidated at $1,434.37 losing $55.9211 million, making it the largest liquidation for the day. Another Binance trader on the BTCUSDT contract lost nearly $10 million in liquidations.
Related: Bitcoin speculators now own the least BTC since $69K all-time highs
The billion-dollar liquidation is the biggest liquidation event in crypto in the past eight months, after the last such event during the FTX collapse.
The price function in the crypto market was attributed to several factors, including the SpaceX Bitcoin write-down and the macroeconomics, where BTC and ETH have been trading in a range for the past couple of months.
BTC held onto the key $28,000 support for a couple of months, while ETH held the $1,500 support before giving in on Aug. 17. The liquidity in the crypto market has been on the lower side, and prominent crypto exchanges, such as Coinbase, had seen a significant decline in their trading volume.
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The Ether futures ETF tracks the futures contract of Ethereum.
The US Securities and Exchange Commission (SEC) is reportedly ready to approve Ether futures exchange-traded funds (ETFs), according to Bloomberg. Thus, its approval would mark a significant milestone for investors looking to gain exposure to the second-largest cryptocurrency by market capitalization.
So far, there have been 16 active filings for an Ether Futures ETF. It is unclear which ETF application the SEC may approve. However, officials suggest there may be an approval by October.
Valkyrie Investments, Volatility Shares, Direxion, Grayscale, VanEck, Roundhill, Proshares, and Bitwise have all filed ETF applications. The longest of these filings is by Valkyrie Investments and has been active for 19 days.
According to Bloomberg analyst Eric Balchunas, historically, the SEC would have asked companies seeking approval for Ether futures ETF to withdraw their filing in 5-6 days.
“We are now on Day 13 and no withdrawals. Not home-free yet but very good sign. As we predicted these will likely hit market in mid-October,” tweeted Balchunas.
Another analyst, James Seyffart, noted that the odds of an approval increases as more days pass between the filing and the SEC’s response.
While the SEC is more likely to approve the Ether futures ETF, it remains unclear what its stance is on filings for the Bitcoin spot ETFs. This is not surprising since the SEC has different standards for approving futures-based ETFs and spot-based ETFs.
Previously, the SEC has expressed concerns about the potential for fraud and manipulation in the BTC spot market. It also noted the lack of reliable data and custody solutions. Consequently, the regulator has rejected several proposals for spot bitcoin ETFs, citing these reasons. Conversely, the SEC has approved several proposals for futures-based bitcoin ETFs.
The first Bitcoin (BTC) futures ETF launched in the US in 2021. Since then, BTC futures ETFs have attracted billions of dollars in inflows. The largest Bitcoin ETF is the ProShares Bitcoin Strategy ETF, with over $980 million in assets under management. The Ether Futures ETF is more similar to the Bitcoin Futures ETF, so the chances of approval remain.
Following the news, the price of ETH rallied after crashing just a few hours before. At the time of writing, Ether was trading at $1691.
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An experienced writer with practical experience in the fintech industry. When not writing, he spends his time reading, researching or teaching.
