Despite positive US economic data, Ethereum is struggling to keep pace with the recent rally in the crypto Market. While other cryptocurrencies are seeing significant gains, Ethereum’s performance lags behind. Investors are closely monitoring the situation as they wait to see if Ethereum will catch up or continue to fall behind.
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Ethereum is struggling to keep up with the recent crypto Market rally, despite positive economic data coming out of the United States. While the overall Market saw a 5.5% increase in total capitalization, Ethereum failed to fully capitalize on this surge.
Bitcoin, on the other hand, experienced a price jump of over 7.5% in the last 24 hours, reaching $66,190. In comparison, Ethereum only gained 5% and struggled to break through the $3,000 resistance level. The rally in the crypto markets was largely driven by U.S. macroeconomic data, particularly the consumer price index (CPI) data, which showed a 3.4% year-over-year rise in April.
However, the retail sales data for April painted a different picture, with stability rather than growth compared to the previous month. This unexpected result has increased the likelihood of the U.S. Federal Reserve implementing measures to stimulate the economy. Analysts believe that the upcoming SEC decision on VanEck’s spot Ethereum ETF application on May 23 is causing hesitation among traders.
Eric Balchunas, a senior ETF analyst at Bloomberg, expressed doubts about the approval of a spot Ethereum ETF in 2024. The SEC’s cautious approach towards products that could be classified as securities is a major concern. This skepticism is also evident in the Ether derivatives markets, with the Ether futures premium standing at 9% and uncertainty looming over Ethereum’s future price direction.
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1. Why is Ethereum struggling to keep pace with the crypto Market rally?
– Ethereum is facing scalability issues, which are causing slow transaction times and high fees compared to other cryptocurrencies.
2. How is positive US economic data affecting Ethereum?
– Positive US economic data is typically associated with a stronger US dollar, which can put pressure on cryptocurrencies like Ethereum that are not tied to traditional financial markets.
3. What can Ethereum do to address its struggles?
– Ethereum developers are working on implementing upgrades to improve scalability and lower transaction fees, such as the upcoming Ethereum 2.0 upgrade.
4. Will Ethereum be able to catch up to the crypto Market rally in the near future?
– It is difficult to predict the future performance of any cryptocurrency, but with ongoing development efforts and improvements, Ethereum may be able to regain momentum in the Market.
5. What should investors consider when investing in Ethereum during this time?
– Investors should consider the potential risks and volatility associated with investing in cryptocurrencies, as well as stay informed about ongoing developments and upgrades within the Ethereum network.
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