![Story image](https://cfotech.com.au/uploads/story/2024/06/14/techday_18c21dd3a4621a45afa4.webp)
Crypto market sees 8.6% rise driven by ETH ETFs approval
The market capitalisation of the cryptocurrency sector experienced a notable increase of 8.6% in May, with all of the top ten coins by market capitalisation concluding the month positively. This information is part of Binance Australia's latest Monthly Crypto Market Wrap.
A significant driver of this momentum was a favourable regulatory environment in the United States. Contributing to this was the provisional approval of eight spot Ethereum (ETH) exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC) and the passage of the Financial Innovation and Technology for the 21st Century (FIT21) Act by the U.S. House of Representatives.
The approval of these ETH ETFs, which followed relatively shortly after the initial approval of Bitcoin (BTC) ETFs in March, led to a substantial surge in ETH prices. On a single day in May, ETH prices soared by 21.2%, culminating in a month-end price of USD $3,957.84.
Ben Rose, General Manager of Binance Australia and New Zealand, noted the high level of activity throughout the month. "It's been another massive month for crypto globally and here in Australia as retail and institutional demand for digital assets continues to grow," said Mr Rose.
Mr Rose pointed out that the narrative of crypto growth is extending beyond Bitcoin. "The crypto growth story is about more than just Bitcoin, with investors increasingly diversifying their crypto investment choices into other coins," he added.
An analysis of the top ten coins traded by Binance Australia users highlights this diversification. The trading volumes of altcoins—any cryptocurrency other than Bitcoin—have increased 3.75 times in value over the last two quarters. This surge has seen altcoins almost double their share, moving from 31% of the top ten in the third quarter of 2023 to 61% in the first quarter of 2024.
The regulatory progress and the approval of ETH ETFs in the U.S. have broader implications for the industry. "The positive ripple effects that the crypto industry has experienced over the last month, largely due to high-profile regulation progress made in the US, has spurred a further increase in interest and investment in digital assets with retail and institutional investors increasingly seeing the potential of crypto beyond Bitcoin," said Mr Rose.
Locally, Monochrome Asset Management made headlines with the launch of its Monochrome Bitcoin ETF on the Cboe Australia exchange. This marks Australia's first spot bitcoin ETF, providing local investors with increased access to digital assets. Additionally, several other Australian BTC ETFs are currently awaiting approval, which could further enhance access to these types of investments.
May also marked a unique anniversary within the crypto community. The 22nd of May is celebrated as Pizza Day, commemorating the 14th year since programmer Laszlo Hanyecz purchased two pizzas for 10,000 bitcoins. In today's market, that transaction would be valued at close to AUD $1 billion.
The Binance Australia Monthly Crypto Market Wrap provides a comprehensive overview of these developments and more, underscoring the dynamic nature of the cryptocurrency sector both locally and globally.