Amidst regulatory upheaval hitting Binance, Ethereum (ETH) surged past the $2,000 mark on the back of increased activity within its network and the anticipation surrounding the approval of a spot ETF.
Ether has seen a slight uptick in price on November 23, staying above the $2,000 level after briefly revisiting $1,930 on November 21. It has demonstrated a 2.5% rise over the last week, while the overall market capitalization grew by 0.5%. This surge is largely attributed to improvements in decentralized applications (DApps), a rise in protocol fees, and Ethereum’s dominance in the nonfungible token (NFT) space.
While the impact of Binance’s recent regulatory challenges looms large, especially after its settlement with the United States Department of Justice, Ether continues to display resilience in the face of this uncertainty.
The closure of Binance’s substantial $2.35 billion worth of ETH derivatives could have significant consequences, given its prominent position in Ether spot trading and 30% contribution to ETH futures contracts’ open interest. Despite initial analyses showing minimal disruptions, Binance recorded net outflows of $1.53 billion between November 21 and November 23, as per DefiLlama.
The regulatory landscape presents a mixed bag. While some interpret Binance’s actions as evidence of ample reserves, others are wary of the hefty $4.3 billion fine and potential long-term impacts on compliance and scrutiny. The relationship between Binance and stablecoins like Tether (USDT), TrueUSD (TUSD), and Binance USD (BUSD) also raises concerns, especially with government agencies gaining access to undisclosed financial activities.
However, these regulatory shifts do carry some positive prospects. Binance’s move towards compliance might pave the way for the approval of cryptocurrency spot exchange-traded fund (ETF) instruments by the U.S. Securities and Exchange Commission (SEC). Notably, excluding Ether from the SEC’s recent lawsuit against Kraken indicates a potential silver lining for Ethereum amidst regulatory uncertainties.
Assessing Ethereum’s network health, DappRadar reports a $26 billion total value locked (TVL) across Ethereum DApps, despite a recent dYdX hack impacting the protocol’s deposits. Ethereum’s resurgence in the NFT market with $12.6 million in 24-hour transactions reinforces its leading position in this space, despite intermittent leadership by Bitcoin.
The recent upward momentum in Ethereum’s performance on November 23 mirrors improved on-chain metrics, growing ETF expectations, and diminished regulatory concerns tied to the 2015 ICO, signaling positive momentum for the cryptocurrency.
