The crypto market continued its upward trend on Wednesday, with most major cryptocurrencies seeing gains. There hasn't been any big news about the industry as a whole, but little tidbits give investors enough reason to buy.
Bitcoin (BTC -0.12%) is up 3.2% in the last 24 hours as of 4:00 p.m. ET, Solana (SOL 9.80%) is up 10%, and Near protocol (VICINITY 12.56%) is up a whopping 18.6%.
The crypto industry is taking small steps forward
This was announced last night Blackrock, Nasdaq, and the Securities and Exchange Commission met for the second time yesterday to discuss rule changes surrounding the listing of a Bitcoin exchange-traded fund (ETF). The possibility of an ETF coming to market has been speculated about all year, and this appears to be at least a small step toward making that a reality.
An ETF could bring new money into the crypto industry by making it more accessible. It is still relatively difficult to buy and sell cryptocurrencies, so a low-cost exchange-traded fund would allow investors access without having crypto wallets or working with centralized crypto exchanges.
Solana's rise continues, supported by news that it now has more decentralized trading volume than ether. Solana's low cost and high speed have made it a popular blockchain for developers, and this helps increase the token's value.
Near Protocol is seeing growing investor interest today as blockchain attracts more developers and collaborations, opening up potential use cases.
Investors and benefits
The two drivers of cryptocurrency currently are the flow of money into the industry and the utility built on the blockchain. All three of these cryptocurrencies benefit from this.
A Bitcoin ETF could attract more investors with a low-cost financial instrument and pave the way for more cryptocurrencies to become ETFs. And the SEC's positive decision in this case could lead to a thaw in crypto regulation in general.
I think the long-term driver of the industry will be a growing number of use cases for blockchain. From financial instruments to logistics applications, companies large and small are testing how they can leverage blockchain. I think this will open up more use cases and companies using this technology.
It is less clear what benefit this has for specific tokens. Solana, for example, is so cheap that even a sharp increase in transactions does not increase fees, and tokens like the stablecoin USD coin can be used as a transaction medium.
Speculation in cryptocurrencies is still widespread, and that accounts for a large part of the short-term increase in value. But there are improvements in the underlying technology and utility that investors shouldn't overlook. And as long as there is an inflow of funds and an increase in innovation, the market can continue to rise.
Travis Hoium has positions in Ethereum and Solana. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Solana. The Motley Fool recommends Nasdaq. The Motley Fool has a disclosure policy.
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.