Ethereum (ETH) is at a historic moment, one that could change its future trajectory for good. Currently, U.S regulators are holding a meeting, to decide on whether Ethereum is a security or not. The whole issue relates to the Ethereum ICO in 2014. According to U.S regulators, people who bought into Ethereum at the time did so with an expectation of profit. They also argue that the Ethereum foundation has a tremendous influence over the value of Ethereum, a scenario that would make Ethereum an unregistered security.
In the case that they declare Ethereum to be a security, the value of Ethereum could drop significantly. That’s because Ethereum would end up engaged in protracted legal battles with U.S authorities. On top of that, there would be an increased uncertainty amongst investors on the future of Ethereum, leading to a sell off.
However, in the case that they decide that Ethereum is not a security, then it would be a real turning point for Ethereum.
Today would most likely be the last day you buy Ethereum (ETH) cheap. That’s because there would be a volumes upsurge as investors move in to capitalize on these news. It would also be a greenlight for more people to start launching ICOs on the Ethereum blockchain, further pushing up its value.
Such news would come at a time when news are coming out that South Korea could be looking to ease up on cryptocurrencies. The country is considering favorable crypto regulations and a re-introduction of ICOs. A combination of positive news from the U.S and South Korea would see Ethereum head to the moon and fast. Many would be left chasing the price, further adding to the bullish momentum.
In essence, the next one hour or so, will be a major test for investor resilience. Those with strong hands and are holding on to their Ethereum (ETH) are likely to be rewarded big time, if the news turns out positive. Ethereum could easily blow above the $1000 mark in the next 24 hours, and continue in that trajectory over the rest of the year. But even if the decision turns out negative, the downturn might not last.
That’s because there would simply be an upsurge in the trading of Ethereum on decentralized exchanges, and crypto is headed in that direction anyway. Major exchanges such as Binance and Bitfinex are already taking the decentralized route. In essence, the long-term trajectory for Ethereum would still be positive, since long-term volumes would stay relatively unaffected.
Therefore, we can conclude that whatever decision comes out today, may not have a long-term impact on the value of Ethereum on the downside. Today’s events will simply be a speculators game. Those strong enough to hold Ethereum right now could see the value of their holdings shoot up by over 20% in the course of the day. In case things don’t turn out right, the long-term fundamentals still support Ethereum (ETH) and crypto in general.
This information should not be interpreted as an endorsement of cryptocurrencies or a recommendation to invest. Historic performance is no guarantee of future returns. As an investment class, cryptocurrencies are speculative investments and investing in cryptocurrencies involves significant risks – they are highly volatile, vulnerable to hacking and capital loss and sensitive to secondary activity. Before investing you should obtain advice and decide whether the potential return outweighs the risks.