Ethereum price rallies above $3.1K after unexpected regulatory victory

May 17, 2024 Coin Telegraph

Ethereum price rallies above .1K after unexpected regulatory victory

Balabce

ETH price hit $3,100, backed by a favorable court ruling and increased network activity.

Ether (ETH) price rose by 5.5% on May 17, nearing $3,100 for the first time in 10 days. Analysts attributed this rally to a decrease in demand for fixed-income instruments following stagnant United States retail sales data in April. This data increased the market’s expectation of a potential interest rate cut by the U.S. Federal Reserve to boost the economy.

Expansionary measures by the central bank are typically seen as bullish for risk-on markets, whether due to an increased monetary supply or reduced credit costs for businesses and individuals. Investors sought exposure to scarce assets, including cryptocurrencies, leading to gold reaching $2,410, just 0.8% below its all-time high.

Ether’s surge was also driven by a U.S. Department of Justice indictment unsealed on May 15. The indictment accused two individuals of wire fraud and money laundering by manipulating the Ethereum blockchain. The document stated that “Ethereum is a decentralized blockchain […] without the need for a trusted intermediary” and added, “No central actor runs the Ethereum Network.”

Crypto markets rally, but Ethereum struggles to keep pace with Bitcoin

May 15, 2024 Coin Telegraph

Coin Telegraph

ETH price continues to trail far behind Bitcoin’s year-to-date gains even after the crypto market responded positively to today’s CPI print.

On May 15, the cryptocurrency markets saw a 5.5% increase in total capitalization following the release of inflation and retail sales data from the United States. However, Ether (ETH) failed to fully capitalize on this bullish momentum. Ether last closed above $3,000 over five days ago and has underperformed the leading cryptocurrency, Bitcoin (BTC), by 22% since the start of 2024.

Crypto markets responded positively to U.S. consumer price index (CPI) data showing a 3.4% year-over-year rise in April, which aligned with market expectations. However, retail sales data for April, released on May 15, unsettled investors as it indicated stability from the previous month, contrary to economists' forecasts of a 0.4% increase. This development increased the likelihood of the U.S. Federal Reserve (Fed) implementing measures to stimulate the economy.

Even if the U.S. Fed decides to maintain interest rates above 5.25% for an extended period to control inflation, the central bank may resort to actions such as purchasing government securities to boost the money supply and reducing the discount rate at which banks borrow from the central bank. Essentially, even a hint of continued liquidity provision can shape economic expectations and behaviors.