Ethereum is once again expected to enter a period of sideways movement after Grayscale, the asset manager, withdrew its application for an Ethereum futures ETF. This news comes alongside SEC Chair Gary Gensler’s comments that most crypto assets should be classified as securities. These developments could contribute to increased uncertainty and price volatility for Ethereum in the coming weeks.
Grayscale’s decision to withdraw its application for an Ethereum futures ETF comes after facing delays from the SEC. Analysts had previously speculated that this move was a strategic way for Grayscale to gain approval for its spot ETF application. However, the withdrawal of the futures ETF application has left experts puzzled about Grayscale’s intentions. The SEC is still set to make decisions on other ETF applications in the near future.
In an interview, SEC Chair Gensler stated that most crypto assets should be considered securities according to US law. He emphasized the need for investors to receive proper disclosures about these assets and criticized the centralized nature of the crypto market. Gensler did not directly address whether he considers Ethereum a security or commodity, avoiding questions about the possibility of a spot ETH ETF.
Despite these developments, Ethereum saw its first inflows in seven weeks, with institutional investors becoming bullish once again. This shift in sentiment could have implications for the future price movement of Ethereum. However, the recent bull-bear stalemate and transfers of ETH by FTX/Alameda Research addresses to Coinbase indicate ongoing uncertainty in the market.
From a technical analysis standpoint, Ethereum is expected to resume a sideways movement, leaning more towards shorts. The key support level to watch is $3,029, as a break below this could trigger a brief bearish trend. However, if the $2,852 to $3,300 range remains strong, Ethereum may remain within this range for the next few weeks, unless there is a significant spike in the price of Bitcoin.
At the time of writing, Ethereum is trading around $3,067, showing a slight decrease of 0.3% for the day.