Ethereum finds itself in a very dangerous situation, with its fate likely in the hands of the US Securities and Exchange Commission: is it a security, or is it a commodity? Is it decentralized enough?
While the industry stands out, It is now or not the price of ETHUSD will rise, or there is a growing risk of a catastrophic collapse of the second largest cryptocurrency by market cap.
Will crypto carnage lead to the collapse of Ethereum?
Ethereum and most other altcoins have taken a brutal hit recently, due to the enforcement actions taken by the US Securities and Exchange Commission against the largest cryptocurrency exchanges. While Ether is not on the list of cryptocurrencies with a security rating, the market is skeptical that it will also not find itself on the SEC’s list.
Ethereum is not quite as “safe” as Bitcoin from regulatory scrutiny due to the recent Proof of Stake change. However, it’s arguably decentralized enough, which could turn into a key measure of what makes or doesn’t make a security, according to recent Hinman documents.
The drop from here looks treacherous | ETHUSD on TradingView.com
Why is ETHUSD at a critical inflection point?
A technical price bounce in ETHUSD is necessary at this point, or else it could find itself in danger of a complete crash. That is if the long-term rising wedge pattern breaks from this level. In contrast, if the level holds, the upper trend line of the wedge is around $10,000 per token.
From a risk versus reward standpoint, the stakes are high – new all-time highs hitting the stratosphere at some point, or unprecedented new lows and the worst bear market in Ethereum history. And it all comes down to this pattern.
With crypto’s lack of liquidity, cloudy regulatory climate, and economic turmoil all around, a negative judgment in the case of loose XRP may eventually push Ether off the cliff it’s hanging off. Meanwhile, a resurgence of risk appetite and a pause in rate hikes combined with a positive ruling in the XRP case or elsewhere in the SEC drama, could save Ethereum from certain doom.
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– Tony “The Bull” (tonythebullBTC) June 14, 2023