Ethereum's Election Surge
Ethereum (ETH-USD) witnessed a remarkable 21% surge from Monday to Tuesday, marking its most significant two-day rally since January 2021. This surge coincided with growing attention to crypto as a political issue, with Ethereum emerging as a prominent winner.
Spot Ether ETF Uncertainty
Before this surge, the outlook for the next major crypto rally appeared uncertain. The government's reluctance to approve spot ether exchange-traded funds (ETFs) dampened enthusiasm. These ETFs were seen as potential catalysts for broader crypto adoption, particularly among less crypto-savvy investors eyeing retirement accounts.
SEC's About-Face
The Securities and Exchange Commission (SEC), responsible for ETF registrations, had stalled discussions with sponsors, casting doubt on the prospects for spot ether ETFs. However, unexpected rumors of a policy reversal emerged, leading Bloomberg analysts to increase the odds of spot ether ETF approval from 25% to 75%. This sudden shift spurred optimism and ignited the surge in ether prices.
Changing Dynamics in Washington
Matt Hogan of Bitwise Asset Management noted a significant shift in Washington's stance on crypto, citing bipartisan legislation and a growing coalition around stablecoins. This change suggests that policymakers are recognizing the popularity and potential benefits of crypto, aligning with the sentiments of American voters.
Crypto's Political Relevance
The recent acknowledgment of crypto's significance by both major political parties underscores its emergence as a crucial election issue. With Trump declaring support for crypto just a week prior, the prospect of courting crypto voters has energized bulls. This shift in government attitude, coupled with widespread adoption and technological embrace, could propel the crypto industry forward, turning previous regulatory headwinds into supportive tailwinds.