The broader cryptocurrency market has experienced significant volatility over the past day as the U.S. Securities and Exchange Commission approved several spot-based Ethereum exchange-traded funds (ETFs).
CryptoSlate Excluding stablecoins such as Tether’s USDT and Circle’s USDC, the top 20 digital assets by market capitalization each saw losses exceeding 3%, according to the data. Bitcoin and Ethereum, the top two digital assets by market capitalization, fell to $67,051 and $3,671, respectively.
Some market analysts have suggested that the ETH ETF approval was a “news selling” event. Investors who were hoping for approval have already positioned themselves accordingly. Over the past week, the price of ETH has risen by more than 20%. CryptoSlate We observed that the Ethereum futures market hit a one-year high of 3.6 million ETH.
Julio Moreno, Head of Research at CryptoQuant, said:
“It appears the market has already priced the approval of an Ethereum spot ETF. Over the past few days, Grayscale’s discount of ETHE to ETH has decreased significantly. The same thing happened between GBTC and Bitcoin as the Bitcoin spot ETF got closer to approval.”
Some experts also pointed to the delayed launch of ETFs as one of the reasons for the poor market performance. The SEC has only approved the ETF but has not yet given it clearance to launch. This requires filing an approved S-1, but this is more of a formality.
Bloomberg ETF analyst James Seyffart explained:
“This is just a 19b-4 approval. It also takes time as the S-1 document needs to be approved. “We expect it to take a few weeks, but it could take longer.”
Over $400 Million Liquidated
Over 107,000 cryptocurrency traders lost over $400 million due to the market’s poor performance.
Long-term ETH traders who had expected the ETF news to boost the price of the digital asset suffered losses totaling $107 million, according to Coinglass data. The largest single liquidation was a $12.4 million long bet on Ethereum on the Binance exchange.
Meanwhile, Bitcoin traders lost about $75 million over the same period.