Bitcoin Investment

Why is the crypto market up today?

The cryptocurrency market is soaring today due to several factors, including approval of a spot Ether ETF, rising inflows into the crypto market up today’s investment products, and an excellent technical setup. As of May 21, the overall market capitalization of cryptocurrencies was $2.6 trillion, up 6.66 per cent from the previous day.

Meanwhile, Bitcoin’s market dominance fell from 54.1% to 52.6%; traders were pleased by the approval of the Ethereum ETF and the optimistic market structure, which might be a spot. The increases have been led by Bitcoin (BTC) and Ether (ETH), which have increased by about 6.4% and 18.5% respectively over the same time frame. Why is the crypto market higher today? Let’s find out.

Increasing chances of a spot Ethereum ETF approval drive prices higher

The news that the SEC may be shifting its position on the matter, possibly in response to political pressure, has prompted crypto bulls to speculate about the possibility of a spot Ether exchange-traded fund (ETF) approval. According to the reports, the SEC has requested that ETF exchanges revise their 19b-4 filings.

Citing the SEC’s about-face on the “increasingly political issue,” Bloomberg senior ETF analyst Eric Blachunas claimed they were raising their odds of a spot Ethereum ETF approval from 25% to 75%. According to finance lawyer Scott Johnson, “Fidelity amending its application by removing the staking feature” clearly indicates the “SEC laying down its arguments to ETH as security.”

According to Balchunas’s file, Grayscale has revised its 19b-4 for the Ethereum Mini Trust, and further changes may be visible throughout the day, as stated in another X post. The price of cryptocurrencies has increased over the past day, with Ethereum’s price reaching an intra-day high of $3,875 on May 21, a 27% increase. Ether and other cryptocurrencies might increase if an Ethereum spot ETF is greenlit.

Investors are returning to crypto investment funds

The continued gains in the crypto market align with the return of investment capital into crypto investment products. In the week ending May 17, cryptocurrency investment products received inflows totalling $932 million, according to data from CoinShares.

Crypto investment products received $932 million last week, as reported in CoinShares’ “Digital Asset Fund Flows Weekly” report on May 13. This indicates that institutional investors have been increasing their exposure to digital assets. Similarly to before, most of the change came from $942 million poured into Bitcoin investment funds.

According to the data, trading volumes in investment products declined from an average of $40 billion in March to $10.5 billion in the week ending May 17. Meanwhile, market data from Farside Investors shows that $947 million, the highest amount since March, poured into spot Bitcoin ETFs last week. It is worth noting that the inflows have occurred following the previous week’s announcement by more than 700 firms that held Bitcoin ETFs in their portfolios.

Thanks to these disclosures and the increasing institutional capital inflows into crypto investment products, Bitcoin and other cryptocurrencies are becoming more accepted and used in the traditional financial industry. This is helping to boost the valuation of the crypto market today.

Strengthening market setup

Looking at the crypto market from a technical standpoint, today’s gains rally at a support confluence that includes the 50-day exponential moving average (EMA) and the upper trendline of a dominant descending triangle pattern.

A descending triangle pattern is seen as a bullish continuation when an uptrend is in progress. When the price reaches the triangle’s peak, which occurs when it rises above the top trendline, the triangles end.

On May 15, the total market cap surpassed this triangle. This technical rule allows the cryptocurrency market to increase by June from its breakout point of $2.23 trillion to the technical target of the ruling chart pattern, which is $2.72 trillion.

Ali Raza

Ali Raza is an experienced freelance content writer. His focus is primarily on aster-crypto and btccoinzone. One might even refer to him as a "blockchain enthusiast." He has been following advancements in the crypto and blockchain area for several years, researching and writing his insights in the media. In addition to being a skilled content writer, Ali Raza is also knowledgeable in SEO and digital marketing. He aspires to succeed as a content creator in the digital realm, dealing with customers in the finance and tech industries to generate traffic through engaging taglines and content. Ali Raza enjoys traveling, reading, and playing cricket when not writing. He now works as a news and article writer for Astercrypto.

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