Is the recent cryptocurrency rout over yet? Probably not, but after booking losses toward the end of last week that were significant at times, the landscape looked a little better for altcoins.
On Monday, quite a few were posting comparatively modest losses, with some even inching cautiously into positive territory. In late afternoon trading, Chainlink (CRYPTO: LINK) was down only marginally, while The Sandbox‘s (CRYPTO: SAND) price was moving sideways. On the gainer side, VeChain (CRYPTO: VET) was up by 3.5%, and Litecoin (CRYPTO: LTC) posted a 0.5% gain.
Spot crypto ETFs apparently approved in a major Asian market
Major geopolitical developments usually impact the financial markets to some degree, and cryptocurrency is no exception to this. After a scare that the ever-volatile Middle East dynamic would worsen with Iran’s attack on Israel, as of late afternoon Monday, the situation seemed to be cooling off encouragingly.
A more direct source of cautious optimism was the apparent approval of spot crypto exchange-traded funds (ETFs) in Hong Kong, one of the most important financial markets in Asia. Asset managers there said the enclave’s Securities and Futures Commission (SFC) gave its first nod to Bitcoin and Ethereum spot ETFs that day, although it was unclear how many or which ones were approved.
The move echoed the U.S. SEC’s approval of such securities back in January, which lit quite a fire under the price not only of Bitcoin, but those of a great many altcoins. Crypto bulls were rightly encouraged that if the SEC is favorable to spot Bitcoin ETFs, approvals for altcoin ones are sure to follow.
This occurred on the week widely expected to witness the latest halving of Bitcoin. As the name implies, halving will see the Bitcoin payouts for mining the cryptocurrency reduced by half (a measure that helps control the ultimately limited supply of the coin). History shows that Bitcoin’s price tends to rise after halving, so in recent weeks investors have piled into it on anticipation of similar gains.
Watch Hong Kong in the coming days
So, for the most part, investors were cautious as the trading week kicked into gear. We should bear in mind that on a year-to-date basis, many of the top cryptos have risen sharply in value, and in such situations, people tend to worry that they’ve soared too high.
Regardless, there is much interest in coins and tokens these days, so perhaps a renewed rally is in store. It would be worthwhile to keep an eye on those Hong Kong spot crypto ETFs; if interest in that market is anywhere near what the U.S. experienced, it could provide a nice driver pushing crypto prices upward again.
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Eric Volkman has positions in Bitcoin and Ethereum. The Motley Fool has positions in and recommends Bitcoin, Chainlink, and Ethereum. The Motley Fool has a disclosure policy.
Why Altcoins Were Struggling to Tread Water on Monday was originally published by The Motley Fool