Ethereum Classic (ETC) Surges 37% Amidst ETF Anticipation
Ethereum Classic (ETC) has experienced a dramatic surge of 37% over the past seven days, reaching $26.65 and boasting a market cap of $3.8 billion. This surge is largely credited to investors anticipating that the U.S. Securities and Exchange Commission (SEC) will consider applications for an Ethereum (ETH) exchange-traded fund (ETF). While the agency recently approved spot Bitcoin ETFs, SEC Chair Gary Gensler has cautioned against assuming that this approval signals a willingness to give ETH the same treatment. Nevertheless, the hype surrounding Ethereum ETF approval has fueled increased trading volumes and driven up the price of Ethereum Classic.
Speculation About Upcoming Ethereum Classic Hard Fork Drives Surge
The timing of Ethereum Classic’s swift climb has left some observers puzzled. Skeptics argue that the surge is in anticipation of an upcoming hard fork scheduled for later this month. This hard fork is rumored to align the network’s Ethereum Virtual Machine (EVM) with Ethereum’s, which could potentially attract projects to collaborate with the chain. Additionally, after Ethereum transitioned to proof-of-stake in late 2022, its former miners redirected their GPU mining rigs to Ethereum Classic, seeking an alternative revenue stream. This influx of miners has contributed to Ethereum Classic’s heightened hashrate, which recently reached all-time highs.
Ethereum Classic’s Hashrate Reaches All-Time High Following Ethereum’s Transition
After Ethereum’s transition to proof-of-stake, Ethereum Classic’s hashrate surged as former Ethereum miners redirected their resources to the network. While Ethereum Classic’s post-Merge hashrate has remained relatively stable, it is significantly lower than Ethereum’s. Ethereum Classic registers only about 30,000 transactions per day, which is roughly similar to Bitcoin Cash. However, Ethereum Classic’s hashrate is less than 15% of what Ethereum recorded just before the Merge. In contrast, ETHPoW, a hard fork of Ethereum initiated around the Merge to compete with Ethereum Classic, currently operates with roughly one-tenth of Ethereum Classic’s hashrate.
Market Reactions to Unofficial SEC Announcement on Ethereum ETFs
Market reactions seemed to anticipate the SEC’s unofficial announcement on possible Ethereum ETFs. Some investors began selling the news prematurely, while others speculated on the potential approval of these ETFs. Larry Fink, the CEO of BlackRock, has expressed support for introducing an Ethereum-based ETF following the successful launch of the Bitcoin ETF. This support from major asset managers like BlackRock has spurred other asset managers to follow suit. The SEC’s approval of Bitcoin ETFs has paved the way for the possible approval of spot Ether ETFs, which could further foster mainstream acceptance of cryptocurrencies.
BlackRock CEO Larry Fink Supports Ethereum ETFs Following Bitcoin ETF Launch
Larry Fink, CEO of BlackRock, has voiced his support for the introduction of an Ethereum-based ETF, following the launch of the highly anticipated Bitcoin ETF. BlackRock’s interest, along with other major asset managers like Invesco, Ark, VanEck, and Grayscale, is expected to drive the SEC to make decisions on spot Ether ETF applications starting in May. The approval of Bitcoin ETFs by the SEC has included companies such as Ark Invest, Bitwise, BlackRock, Fidelity, Franklin Templeton, Grayscale, Hashdex, Invesco, WisdomTree, Valkyrie, and VanEck. Some of these ETFs have already begun trading, with Grayscale, BlackRock, and Fidelity dominating trading volumes. The approval of Ethereum ETFs could have significant implications for the adoption and acceptance of the cryptocurrency in traditional investment vehicles such as 401(k)s, IRAs, and pension plans.
Analyst comment
Positive news.
As an analyst, the market for Ethereum Classic (ETC) is expected to continue its upward trend in the short term due to anticipation of an Ethereum ETF approval by the SEC and the upcoming hard fork scheduled for later this month. This could attract more projects to collaborate with the chain and further increase trading volumes and the price of Ethereum Classic. The support from major asset managers like BlackRock for an Ethereum ETF could drive the SEC to make decisions on spot Ether ETF applications, potentially fostering mainstream acceptance of cryptocurrencies.
