Analyst Says Ethereum Spot ETFs Approval Will See “Animal Spirits” Reignite Crypto – What This Means
May 24 2024 - 2:30PM
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A crypto analyst has made a rather cryptic prediction, suggesting
that the approval of Ethereum Spot ETFs by the United States
Securities and Exchange Commission (SEC) could unleash a new wave
of “animal spirits.” This term in crypto is often used to describe
an irrational exuberance and optimism that fuels financial
markets. Ethereum Spot ETF To Reignite Animal Spirits In an X
(formerly Twitter) post on May 22, a crypto analyst identified as
“the DeFi Villain,” made a bold forecast, anticipating the
resurgence of the bull run altcoin season following the SEC’s
approval of Ethereum Spot ETF. The analyst revealed that the
approval could let loose “animal spirits,” driving renewed demand
and positive sentiment in the market and possibly resulting in a
bull market. Related Reading: Bitcoin Price Drop Below
$70,000 Apparently Driven By Lack Of Interest, Glassnode Data Shows
The analyst outlined a long list of altcoins that outperformed and
experienced remarkable rallies in 2021. These rallies propelled
each of their market capitalizations from mere hundreds of millions
to billions in the span of a few days and months. Among the
cryptocurrencies highlighted by DeFi Villain, some notable altcoins
recorded a massive rise in market capitalization, including
Dogecoin (DOGE), THORChain (RUNE), Filecoin (FIL), Binance Coin
(BNB), Axie Infinity (AXS), Shiba Inu (SHIB), and others. According
to the crypto analyst, Dogecoin witnessed a 10x increase in one
day, in January 2021. While RUNE market capitalization surged from
$200 million to $5 billion in just five months. One of the
most remarkable increases was seen in Filecoin which almost reached
the current market capitalization of Ethereum. The cryptocurrency
had jumped close to a whopping $400 billion during the altcoin bull
run in 2021. Other cryptocurrencies like AXS surged from a
market capitalization of $200 million to $10 billion, with its
Fully Diluted Value (FDV) topping $43 billion at some point.
Additionally, Binance Coin, which was already worth $6 billion in
early 2021 and among the top 20 cryptocurrencies, had witnessed a
mega 8x pump in 20 days, reaching a staggering $50 billion in
February 2021. Even popular meme coins like Shiba Inu (SHIB)
had rallied hard, jumping from $4 billion to $40 billion in less
than a month. Ethereum Cash (ETC) also saw its market
capitalization rise from $600 million to $17 billion in five
months. These massive surges during the 2021 bull run underscore
the potential altcoins have on the crypto market and how insane
they can surge once the altcoin season hits and the dominance for
Bitcoin shifts to lesser cryptocurrencies. DeFi Villain has
predicted that the final leg for meme coins is likely going to be
“Vertical and Brutal,” suggesting that these volatile
cryptocurrencies could have another powerful rally to new highs
this market cycle. ETF Approval Nullifies SEC’s Previous
Security Claims? Over the past few months, the US SEC has made
claims implying that Ethereum, the second largest cryptocurrency,
was considered a security. However following the authorization of
Ethereum Spot ETFs, the SEC has finally recognized Ethereum as a
non-security. Related Reading: Analyst Predicts An “Ultra
Bull” Scenario For Bitcoin That Could Send Price To $80,000 Calling
the regulator out on this contradiction, Paul Grewal, Chief Legal
Officer (CLO) of Coinbase disclosed that if Ethereum which lacks
“contractual agreement or undertaking,” is no longer considered a
security by the SEC, then Bitcoin (BTC), which operates similarly
without the above agreements, should also be a non-security. Grewal
posed a compelling question regarding the classification of 12
other cryptocurrencies, which can be compared to Ethereum and
Bitcoin in terms of their non-security treatment by the SEC. The
Coinbase CLO disclosed that the implications that these 12 other
cryptocurrencies are considered securities despite also lacking
contractual agreement or undertaking raises the question about the
SEC’s possible lack of regulatory clarity and inconsistent
regulatory approach to different crypto assets. Featured
image created with Dall.E, chart from Tradingview.com
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