Ethereum

Will SEC obstacles derail the optimistic journey?

Ethereum (ETH) is at a critical juncture, aiming for a price of $4,000. In this ambitious pursuit, digital assets face a significant challenge that could affect their trajectory: scrutiny from the U.S. Securities and Exchange Commission (SEC).

Despite these potential regulatory hurdles, some analysts remain optimistic about Ethereum’s prospects. detailed analyze Market observer Captain Faibik highlighted a bullish pattern on ETH’s 4-hour candle chart, suggesting that the $4,000 threshold has been reached.

Ethereum Eyes $4,000 Milestone

This optimism stems from a descending wedge pattern observed by Faibik, which indicates the end of Ethereum’s consolidation phase and a possible price breakout. Technical analysis paints a promising picture for Ethereum, suggesting that the asset can regain its lost value.

However, recent market conditions have presented challenges for Ethereum. The asset has fallen more than 15% in two weeks, made worse by a broader correction in the Bitcoin market.

This decline led to a significant drop in ETH to $3,070 on March 20, leaving ETH trading below the $3,500 level. This is due to reports of the SEC’s increasing interest in classifying Ethereum as a security.

Specifically, according to the report, the committee is seeking the financial records of U.S. companies associated with the Ethereum Foundation, deepening the debate over Ethereum’s classification. These regulatory investigations cast a shadow over Ethereum’s path to $4,000 and bring uncertainty to its future.

ETF analyst James Seyffart suggests that spot Ethereum ETF applications could be rejected until May 23, 2024 due to the SEC’s stance. He notes the lack of engagement with Ethereum details, in contrast to the approach taken with the Bitcoin ETF.

Ethereum’s Network Activity: Wishlist

Despite these challenges, the Ethereum network has seen notable growth, with daily active users and trading volume increasing, signaling an optimistic outlook for the cryptocurrency. A surge in network activity usually indicates increased demand, which is a positive sign for Ethereum’s price potential.

Since January 3, the number of daily active Ethereum addresses has surged by more than 46%, coinciding with significant price increases. This period of increased activity and price appreciation highlights Ethereum’s resilience and growth potential despite regulatory uncertainty.

As Ethereum navigates these regulatory and market challenges, the next few weeks will be critical in determining its ability to break $4,000. The juxtaposition of technical bullish signals against the backdrop of the SEC investigation presents a complex scenario for ETH.

However, a strong network and increasing user participation offer a glimmer of hope for Ethereum enthusiasts and investors.

TradingView Ethereum (ETH) price chart
ETH price is moving sideways on the 4-hour chart. Source: ETH/USDT on TradingView.com

Featured image by Unsplash, chart by TradingView

Disclaimer: This article is provided for educational purposes only. This does not represent NewsBTC’s opinion on whether to buy, sell or hold any investment, and of course investing carries risks. We recommend that you do your own research before making any investment decisions. Your use of the information provided on this website is entirely at your own risk.

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