Bitcoin and Ethereum tumble as Consensys declares ETH ‘Survives the SEC’, as MicroStrategy keeps accumulating
DATA from CryptoCompare shows that the price of Bitcoin dropped by around 8% over the past week to a low below the $61,000 mark, with the cryptocurrency itself now trading at around $61,250 as it endures a bearish turn.
Ethereum’s Ether, the second-largest cryptocurrency by market capitalization, saw similar performance, dropping by around 8.5% over the past week to just under $3,250 before recovering to now trade at around $3,300 per ETH.
Headlines in the cryptocurrency space this week saw Consensys Software, the blockchain technology firm behind the popular cryptocurrency wallet MetaMask, declare “Ethereum survives the SEC” after the US Securities and Exchange Commission closed its investigation into Ethereum 2.0.
Consensys declared it a “major win” for the industry, as the closure meant the regulator won’t bring any charges alleging that sales of ETH are securities transactions. The firm noted the SEC’s decision comes after Consensys sent it a letter requisition confirmation the investigation would be closed, based on the SEC’s approval of spot Ethereum exchange-traded funds (ETFs) last month, which indicate it sees ETH as a commodity.
While SEC Chair Gary Gensler has avoided directly stating whether the regulator sees ETH as a commodity or a security, Commodity Futures Trading Commission Chair Rostin Behnam has categorized the cryptocurrency as a commodity.
Over the week the regulator also rejected Ripple Labs’ attempt to reduce the potential fines it faces in their ongoing legal battle, arguing that the circumstances surrounding Ripple’s case differ significantly from the recently settled case with Terraform Labs, which has to pay the regulator a hefty $4.5 billion.
Hashdex, a Brazilian asset manager, filed with the SEC to launch a combined spot and Ether ETF on the Nasdaq, offering investors exposure to both leading cryptocurrencies based on their current market capitalisation, with the latest filing pointing to 70.54% BTC and 29.46% ETH.
The fund would initially focus solely on BTC and ETH, but could include other cryptocurrencies based on specific criteria, which includes being listed on a U.S.-regulated digital asset trading platform.
Meanwhile, Canadian asset manager 3iQ has filed to launch a publicly traded Soalan exchange-traded product (ETP) on the Toronto Stock Exchange. This would be the first publicly traded Solana ETP in North America.
MicroStrategy acquires additional 11,931 Bitcoin
Nasdaq-listed business intelligence firm MicroStrategy has acquired an additional 11,931 BTC for approximately $786 million, at an average price of $65,883 per coin. The move brought its total holdings of the flagship cryptocurrency to 226,331.
These coins were bought for around $8.33 billion in total, and are currently worth more than $13.8 billion. This latest acquisition follows the purchase of 9,245 BTC for $623 million back in March, which was followed by two smaller transactions that pushed the firm’s holdings past 1% of Bitcoin’s total supply of 21 million.
The week also saw German-based telecommunications firm Deutsche Telekom announce plans to enter the Bitcoin mining space. The firm, which has been operating a Bitcoin node since 2023 alongside Lightning Network nodes, revealed the move at the BTC Prague conference.
Another development over the week came from leading stablecoin issuer Tether, which announced the launch of a new synthetic dollar token backed by its gold-backed stablecoin Tether Gold.
The new token, called Alloy (aUSDT), will trade on the Ethereum blockchain, and can be created if users deposit Tether Gold as collateral, in an overcollateralized system where the value of the deposited gold will exceed the value of the minted aUSDT.
Tether’s gold-backed cryptocurrency is backed the reserves of the precious metal held in vaults in Switzerland, and has a market capitalization of over $570 million. The launch of Alloy sees Tether introduce a new category of digital assets, which are “tethered assets, designed to track the price of reference assets through stabilization strategies like over-collateralization.”
Over the week data also shows that the total funding of venture capital into cryptocurrency startups surpassed the $100 billion mark after a recent pick-up amid the latest crypto market rally.
While venture capital poured in, traditional exits like major acquisitions and public listings have been scarce in the space, with Coinbase’s 2021 direct listing being a rare exception. Some investors have exited the space after high-profile failures like those of FTX and BlockFi.
Francisco Memoria is a content creator at CryptoCompare who’s in love with technology and focuses on helping people see the value digital currencies have. His work has been published in numerous reputable industry publications. Francisco holds various cryptocurrencies.
