May 22 2024: Bitcoin’s price dipped slightly on Wednesday as traders locked in gains from a recent rally amid anticipation of more cues on U.S. interest rates. This optimism was driven by the potential approval of a spot Ether exchange-traded fund (ETF).
Bitcoin’s Decline Amid Rate Concerns
Bitcoin fell 1.5% over the past 24 hours to $69,880.1 by 01:33 ET (05:33 GMT). Warnings regarding persistent U.S. inflation and the likelihood of prolonged high interest rates contributed to trader caution, pulling Bitcoin back from its recent gains. The cryptocurrency had briefly risen to $71,000 on Tuesday before settling back into a $60,000 to $70,000 trading range, which it has occupied for much of the past two months.
Ether’s Steady Gains on ETF Speculation
Ether, the world’s second-largest cryptocurrency, remained steady at over a two-month high following reports of progress towards the approval of spot Ether ETFs by the U.S. Securities and Exchange Commission (SEC). Ether rose 3% in the past 24 hours to $3,755.37, close to its highest level since early March, after surging as much as 18% on Monday.
Media reports indicated that the SEC had requested exchanges to refine their filings for spot Ether ETFs ahead of a critical decision expected later this week. While the SEC has not yet engaged with any applicants, this move signals some progress and has increased the perceived probability of eventual approval. Analysts believe the approval of a spot Ether ETF could trigger a significant rally in crypto prices, similar to the effect seen with the approval of spot Bitcoin ETFs earlier this year.
Focus on Fed Cues
Despite the optimism over a spot Ether ETF, sentiment towards crypto remains constrained by ongoing concerns over U.S. interest rates. Several Federal Reserve officials emphasized the need for more evidence that inflation is declining before the central bank can consider cutting interest rates. Market focus is now on the minutes from the Fed’s late-April meeting, which could provide further insights into when the central bank might begin reducing rates.
Altcoin Market Activity
Broader altcoin prices also cooled as Bitcoin retreated. While traders remained largely focused on Ether, the resilience of the U.S. dollar limited significant gains in the crypto market.
Solana: Fell 0.2%
XRP: Shed 0.5%
Meme Coins: Dogecoin rose 3.1%, while SHIB increased by 1%
Overall, the crypto market is closely watching the developments around the SEC’s decision on Ether ETFs and the Fed’s stance on interest rates, which are likely to influence market trends in the coming days.
