Current Ethereum Price: $1,940
- Cboe BZX Exchange has submitted a proposed rule change to the SEC, seeking permission for staking in Fidelity’s spot Ethereum ETF.
- Grayscale and 21Shares have made similar submissions to the SEC regarding the staking of their Ethereum ETF assets.
- If ETH surpasses $2,200, it may test the significant resistance at $2,850.
On Tuesday, Ethereum (ETH) rose by 3% following the filing by Cboe BZX with the Securities & Exchange Commission (SEC) to enable staking within its Fidelity Ethereum Fund (FETH).
Fidelity’s Plans for Staking Its Ethereum ETF
The Cboe BZX Exchange has filed a 19b-4 form with the SEC to facilitate staking within Fidelity’s Ethereum Fund.
“Based on discussions with the Sponsor, the Exchange intends to revise several components of the ETH ETP Amendment No. 2 to allow for the staking of ether held by the Trust,” the filing indicates.
Prior to Fidelity’s filing, Grayscale and 21Shares also sought SEC approval to allow staking within their respective ETFs.
Staking enables individuals to earn passive income by utilizing crypto assets to enhance the security of a blockchain.
The recent filings from U.S. spot Ethereum ETF issuers aiming to incorporate staking come in light of recent changes at the SEC, notably the departure of former Chair Gary Gensler on January 20.
Before the approval of ETH ETFs in July 2024, most issuers chose to exclude staking from their initial applications amid speculation that the Gensler-led SEC was not favorable toward this feature.
However, the agency might revise its position as President Trump and the new SEC administration under Acting Chair Mark Uyeda appear more supportive of pro-crypto regulations.
Nate Geraci, the President of the ETF Store, has previously suggested that U.S. spot Ethereum ETFs could potentially outpace Bitcoin ETFs if the SEC permits issuers to stake their holdings.
Ethereum ETFs experienced four consecutive days of negative flows, recording outflows of $37.50 million on Monday.
Ethereum Price Outlook: ETH Aims for Recovery Above $2,200
In the past 24 hours, Ethereum encountered $131.39 million in futures liquidations, as reported by Coinglass. This included $83.31 million in long position liquidations and $48.09 million in short position liquidations.
ETH found support around the $1,750 level, identified by measuring the percentage change within the $2,850 to $2,200 rectangular channel and projecting it downward.
ETH/USDT daily chart
If the leading altcoin maintains support at $1,750 and reclaims the $2,200 mark, it could aim for the critical resistance level at $2,850.
The Relative Strength Index (RSI) and Stochastic Oscillator indicate a reduction in bearish pressure, having pulled back from the oversold territory.
A daily close below $1,500 would negate this outlook and could send ETH toward the psychological barrier of $1,000.
FAQs About Ethereum
Ethereum is an open-source decentralized blockchain featuring smart contract functionality. Its native currency, Ether (ETH), ranks as the second-largest cryptocurrency and leads the altcoin market by market cap. The Ethereum network facilitates the development of diverse crypto solutions, including decentralized finance (DeFi), GameFi, non-fungible tokens (NFTs), and decentralized autonomous organizations (DAOs).
Ethereum operates as a public decentralized blockchain, allowing developers the freedom to create and deploy applications that do not rely on a central authority. The network utilizes the Solidity programming language and the Ethereum virtual machine to assist developers in building applications equipped with smart contract capabilities.
Smart contracts are verifiable codes that automate agreements among multiple parties. Essentially, these codes execute predefined actions automatically when specific conditions are satisfied.
Staking involves earning rewards on idle crypto assets by locking them into a crypto protocol for a set time, thereby contributing to its security. On September 15, 2022, Ethereum shifted from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) model in an event known as “The Merge.” This transition was crucial for Ethereum’s roadmap to improve scalability, decentralization, and security while maintaining sustainability. Unlike PoW, which requires expensive hardware, PoS lowers entry barriers for validators by using crypto tokens as the foundation of its consensus mechanism.
Gas refers to the unit used to measure transaction fees for processing transactions on Ethereum. During times of network congestion, gas prices can spike significantly, leading validators to prioritize transactions based on the fees they generate.