- Ethereum wants to achieve real-time proof through advanced cryptography.
- FTX/Alameda has deposited 4,000 ETH into Coinbase.
- ETF analyst James Seyffart confirmed that Defiance Investment has applied for a 2x leveraged Ethereum futures ETF.
Ethereum broke out of a one-week consolidation streak on Monday when it outperformed Bitcoin (BTC) to reach $3,730. The price increase highlights rising social media activity for Ethereum following Vitalik Buterin’s speech at Tuesday’s Hong Kong Web3 carnival.
Daily digest market movers: Vitalik’s speech, FTX ETH deposit, Defiance futures ETF
Ethereum has been showing high social media activity since Monday, according to data from LunarCrush. Here are some of the market movers causing increased attention for the largest altcoin:
- In a speech titled “Reaching the Limits of Protocol Design” at Tuesday’s 2024 Hong Kong Web3 carnival, Ethereum co-founder Vitalik Buterin drew a contrast between protocols of the 2010s and 2020s. He stated that while protocols of the 2010s were mainly based on basic cryptography, protocols in the 2020s need to be based on advanced cryptography, such as ZK-SNARKs, MPC, FHE, 2PC or Aggregation.
However, he also noted the efficiency and security issues in these advanced cryptographic solutions and how they slow block verification and proof time. He further went on to clarify that Ethereum aims to achieve real-time proof and suggested “parallelization and aggregation trees” as a potential solution. Vitalik also presented an Ethereum ecosystem diagram that sparked debate in the crypto community. The diagram featured projects like Arbitrum (ARB), Optimism (OP) ecosystem, Starknet ecosystem, zkSync, Metis, Linea, Scroll, Fuel and Polygon (MATIC), excluding Layer 2s that do not use Ethereum as their data availability layer.
- According to Spot On Chain, defunct exchange FTX and its sister firm, Alameda Research, deposited 4,000 ETH worth $14.75 million to Coinbase on Monday. The duo has been depositing ETH on Coinbase since the market rally on February 1, and its recent deposit brings the total to 21,650 ETH—approximately $72.4 million.
- This comes at a time when Defiance ETFs have filed for a 2x leveraged Ethereum futures ETF, as confirmed by Bloomberg analyst James Seyffart in an X post on Monday. If approved, the leveraged ETH futures ETF could go live around late June, trading under the ticker ETHL. The recent filing contrasts Defiance’s earlier application for 2x Short MSTR ETF, tracking 2x the daily inverse performance of MicroStrategy incorporated stock. The move appears complex as Bitcoin’s price movement has heavily influenced MicroStrategy’s stock and ETH price in the past few years.
Also read: Ethereum on course to post weekly losses as debate over security status continues
Technical analysis: Ethereum bulls may not sustain buying pressure
Ethereum’s price has seen a correction in the past 24 hours after reaching a three-week high of $3,730 on Monday. Its recent price increase indicates a short-term excitement among long traders. However, liquidation data from Coinglass on Tuesday shows bears are beginning to have their way, with ETH seeing the largest liquidation of more than $69.5 million. Liquidated long positions account for $48.9 million.
The largest single liquidation order occurred in an ETH-USD-SWAP worth $7.5 million. ETH is trading at $3,515, down 3.5% on the day. It has broken previous support levels of $3,570 and $3,517 and tested the next support of $3,479. This move is to fill the liquidity void posted on Monday.
ETH/USDT 4-hour chart
If bulls show weak hands, ETH could decline further, especially as Bitcoin trades in the red on Tuesday.
Bitcoin, altcoins, stablecoins FAQs
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin’s market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
