The approval of the Ethereum ETF was not expected as soon as it appeared. However, the market's reaction is not what the majority of Ethereum bulls likely expected. In its current state, Ethereum barely moved past the local resistance level and even retraced further.
So, what's holding Ethereum back?
Only 19b-4s approved, Not S-1s
The current approval pertains only to 19b-4s and not the more significant S-1s. In simple terms, this means that while a step has been taken toward greater acceptance, the bigger, more impactful approvals are still pending. The market knows this and is not getting too excited until the S-1s are also greenlit. It is a classic case of the market pricing in expectations — partial approval is good but not groundbreaking.
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"Delegated authority"
This ETF approval was handled by the Division of Trading and Markets using "delegated authority." This implies that a commissioner could still challenge the decision within the next 10 days. There is a sense of uncertainty hanging over the market, knowing that this approval might not be the final word. It feels a bit like they are trying to sneak this through, keeping the vote somewhat under the radar due to its political nature.
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These points create a scenario where the Ethereum ETF approval, while positive, is not a guaranteed ticket to the moon. There remains political maneuvering, and further approvals needed to solidify the move. Plus, against the backdrop of broader regulatory and economic uncertainties, investors are playing it safe for now.
Despite the lack of momentum, Ethereum is still looking well positioned for a rally; above numerous key technical resistances, cheap network fees might attract more activity and a fair price level ahead of the major $4,000 threshold.