A Second Ethereum ETF Is Seeking SEC Approval

In brief

  • WisdomTree, a financial services company, has filed for an Ethereum ETF.
  • It’s the second filing for an Ethereum ETF in the US.

WisdomTree, an asset manager with a focus on investment products, has filed for an Ethereum ETF.

ETFs, or exchange-traded funds, track the performance of an underlying asset or group of assets. They’re a good option for traders who don’t want to deal with the risks of actually holding the underlying investment, and would rather just treat it like a regular stock.

Companies like WisdomTree see crypto as a good use case, since blockchain tech is notoriously difficult to navigate: wallets can be confusing, transaction fees are expensive, and tax obligations are unclear. An Ethereum ETF would make things easier for investors who aren’t quite ready to hold ETH but want to get in on the market.

WisdomTree is the second firm to file for an Ethereum ETF, after VanEck. According to its S-1 filing, shares would be listed on Cboe’s BZX exchange.

Brazil and Canada recently got their first Bitcoin ETFs. Bitcoin fans in the US have been clamoring for a crypto ETF for years, but the SEC has yet to approve one. Bitcoin ETF applicants haven’t been able to convince the SEC that the crypto market is free of manipulation and safe enough for mainstream retail investors.

It’s not for lack of trying—plenty of companies have filed for Bitcoin ETFs over the years, including WisdomTree. Along with WisdomTree’s filing, SEC is currently reviewing active applications from Fidelity, VanEck, Kryptoin, and Anthony Scaramucci’s SkyBridge Capital.

The Winklevoss-owned crypto exchange Gemini became the first company to file for a Bitcoin ETF back in 2013.

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This Low-Cap Altcoin Eyes Big Bounce After Brutal Decline, According to Top Analyst

A prominent crypto analyst has high expectations for one small-cap altcoin after an 82% crash from an all-time high of $22 to a low of $4.00.

For his 313,800 followers on Twitter, trader and crypto strategist Kaleo paints a bullish picture for Terra’s (LUNA) recovery, amid its severe drop in the crypto market.

He expects a relief move back up to double digits, a 2.5x jump at minimum from its low.

“The LUNA BTC chart looks rough, but the USD one looks a hell of a lot better. Clean bounce so far on strong HTF support.

I’ll be shocked if this doesn’t get a relief bounce at least back to double digits.”

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Source: Kaleo/Twitter

Since the market began its recovery, Kaleo notes that Terra is one of the best performers among other altcoins, shooting up more than 50% from its low.

“LUNA still the best performing alt of the day up more than 50% from the lows after the bounce from HTF support.”

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Source: Kaleo/Twitter

Kaleo also sees promise in the LUNA/BTC pairing. LUNA / BTC looks ready for continuation higher”

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Source: Kaleo/Twitter

Terra was created by Korean blockchain company Terraform Labs.

It is a decentralized financial payment network that uses fiat-pegged stablecoins to settle global payments. It runs on a proof-of-stake blockchain that utilizes its reserve currency, Luna, to provide security and validation to the network.

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Featured Image: Shutterstock/Ana Aguirre Perez

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Cardano Developer Unveils Smart Contracts Platform Rollout Plan

Cardano’s developer Input Output Global (IOG) has made several important announcements on the platform’s next update. Schedule to be implemented with Hard Fork Combinator event “Alonzo”, this new era will mark the beginning of Cardano’s smart contract capabilities.

IOG reveal “Alonzo” rollout plan with an initial phase in June expanding to its full deployment in September 2021. Formed by a series of color-coded testnets, IOG has started with test Alonzo Blue. This first phase will be conducted with a pioneer task force, initial partners, and a spin-up with core stakepool operators.

The testnet will check basic network functionalities. Alonzo Blue will have the first exercise on this test phase with the Hard Fork node to Alonzo and initial distribution of ADA to stakepool operators simple Plutus scripts.

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Later, IOG will launch Alonzo White with more partners involved, demo dApps, integration with WBE and PAB, benchmarks, and more participation from around 500 community members, pioneers, stakepool operators (SPO).

This testnet will allow partners and pioneers to run their scripts on the network with the first benchmarking basic dApps for versions of Uniswap and stablecoins. In addition, Alonzo White will introduce the first exchanges integrated with the Rosetta framework, a mechanism created by Coinbase to facilitate adding tokens to these platforms.

After that, in August, Alonzo Purple will launch the first public testnet with all Pioneers “onboarded” with the partners dApps. During this phase, components Daedalus Flight and Explorer will be tested alongside the stability of the platform.

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Finally, Alonzo will have two small stages called Red and Black, but Alonzo Purple will “pretty much” have Plutus and smart contracts ready for the HFC event in the final month of Q3, 2021.

Cardano, Where Everyone Will Use A Smart Contract?

In separate news, IOG launch Marlowe Run, a prototype app to facilitate the use of smart contracts. Users won’t require technical experience with blockchain, according to the official announcement. Cardano’s developer said:

The app incorporates the full, industry standard, ACTUS library of financial contracts. Being blockchain-based, it promises benefits in terms of cost, efficiency and security. It is populated with contract templates which have been written and tested by ACTUS experts.

Marlowe is a programming language with the special purpose of building financial contracts on Cardano. Unlike other programming languages, Marlowe will be “easy to read”, write and comprehend.

Thus, financial agreements will be settled on this blockchain without the need for a third party’s intervention. IOG seeks to “transform” the way businesses are conducted around the world.

ADA trades at $1,68 with small losses in the past day and an 11.1% profit in the weekly chart. In the 30-day chart, ADA still records a 36.5% profit after the cryptocurrency reached the important psychological mark of $2.

Cardano ADA ADAUSDT

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Market enters a ‘wait-and-see phase’ as Bitcoin struggles below $40,000

Price action for Bitcoin (BTC) and the wider cryptocurrency market was relatively subdued on May 27 as nervous traders remain unsure of what comes next following last week’s market plunge that saw leveraged traders wiped out as BTC dipped as low as $30,000 before its price rebounded. 

Data from Cointelegraph Markets Pro and TradingView shows that while Bitcoin’s price has managed to put in higher highs and higher lows over the past week, bulls continue to face stiff resistance at any meaningful attempt to break above $40,000 as bears defend the psychologically important level.

BTC/USDT 4-hour chart. Source: TradingView

For many traders, the recent correction likely triggered PTSD-like flashbacks of the market crash of 2017 and 2018 and the ensuing two-year crypto winter, and this could be a reason why the market seems indecisive at the moment.

Given that many traders are unsure of what might come next for Bitcoin’s price, it’s wise to consider the various bullish and bearish scenarios that could play out and to also take stock of the opinions of analysts in the sector.

Traders remain cautious after the recent sell-off

According to David Lifchitz, managing partner and chief investment officer at ExoAlpha, it’s important to look closely at the recent market events and review the catalysts that created the current situation.

Lifchitz told Cointelegraph that following an “almost uninterrupted bull run from $10,000 in October 2020 to an all-time high for BTC at $65,000 in mid-April 2021,” the market saw several waves of profit-taking ahead of the “great deleveraging of 2021,” which saw the price of BTC fall by 54% to $30,000, while Ether (ETH) and altcoins were hit even harder.

According to Lifchitz, the correction succeeded in “drastically reducing the amount of leverage that prevailed in the ecosystem,” which can be seen as a healthy development for the overall market, as it will help “to build on a more stable base.”

Estimated leverage ratio for Bitcoin. Source: CryptoQuant

Lifchitz cautioned that while data shows that some early dip-buyers managed to pick up tokens near the lows, both volumes and futures open interest have remained weak, “showing no urgency to reload.”

The monthly options expiration for Bitcoin and Ether are less than 24 hours away, and Lifchitz believes they are standing in the way of “any meaningful move in the very short term.” He also suggested that it will be “difficult to convince burned investors to get back in the game just now” due to a lack of upside catalyst and the recent reminder that “prices do not always go up.”

This has put the market in a “wait-and-see phase,” according to Lifchitz, with both trend followers and contrarian investors needing “to see some motion, either up or down” before they engage in the market.

Lifchitz said:

“The market definitely needs a catalyst, either upward or downward to move ahead. A too long period without any catalyst could lead to investors fatigue who might decide to cash out and seek other pastures, which would act as gravity on cryptos triggering a downward move. The next few days/weeks will be very telling of what to expect next.”

Bullish indicators abound

While the average crypto trader is currently in a state of stasis and awaiting the next major market move to signal what BTC might do next, on-chain data indicates bullish moves from larger players who took full advantage of the recent dip by buying.

According to Micah Spruill, managing partner and chief investment officer at S2F Capital, most of the selling that was seen at the recent lows “has been from newer entrants to the market” who have “been selling at a loss and seem to be exhausted at this point.”

In a conversation with Cointelegraph, Spruill pointed to BTC net transfer volume, which shows that following the bearish downturn between May 17 and 20, “Massive amounts of USDC and USDT have been sent to exchanges (to buy BTC, ETH, etc.) and pull them off to long term storage.”

BTC net transfer volume to/from all exchanges. Source: Glassnode

Further analysis shows that retail wallets holding between 0.1 and 1 BTC, as well as whale wallets holding between 1,000 and 10,000 BTC, have been accumulating at these levels in preparation for an overall move higher.

Another bullish indicator mentioned by Spruill is entities’ net growth, which “is recovering back to prior levels” and may signal that “the bull market is back in full force” if this trend continues over the next few weeks and the metric resumes its highs.

Entities net growth for Bitcoin. Source: Glassnode

Overall, Spruill sees a positive move for BTC in the future, although the timing is questionable due to a variety of factors.

Spruill said:

“I think there’s a possibility we could spend an extended period of time (months) between the $30,000 to $42,000 level as the market digests recent events and we endure a mid-cycle re-accumulation period. Alternatively, it’s possible we have a COVID-like recovery whereby we see Bitcoin break outside this range soon and recover much faster than others are expecting.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, and you should conduct your own research when making a decision.