In a remarkable recovery, cryptocurrency prices managed to regain ground last Tuesday, overcoming a challenging period earlier in the week. Bitcoin emerged as the frontrunner, leading the resurgence.
This turnaround followed a tumultuous day marked by a massive sell-off triggered by the U.S. Securities and Exchange Commission (SEC) suing Binance, a prominent cryptocurrency exchange. It is noteworthy that Coinbase, a major competitor of Binance, also faced a second lawsuit.
Cryptocurrency Prices Surge
The leading cryptocurrency, with the highest market capitalization, recently experienced a significant surge, surpassing $27,000 and marking an almost 6% increase within the last 24 hours.
Just the previous Monday, Bitcoin had plummeted near $25,400 as nervous investors, already shaken by months of digital asset challenges, abandoned cryptocurrency after the SEC accused Binance of violating securities law.
In addition to Bitcoin‘s recovery, the broader cryptocurrency market has also regained momentum since Monday, albeit to a slightly lesser extent than BTC. Ethereum, the second-largest cryptocurrency by market value, recently saw a trading price just below $1,900, reflecting a 4.5% increase from Monday’s level.
Furthermore, the tokens of smart contract platforms Cardano (ADA) and Solana (SOL) experienced a rebound, climbing over 1% in value. This followed a notable decline of more than 8% for ADA and over 10% for SOL the day before.
Binance’s native token, BNB, displayed a positive trend, while Polygon’s MATIC saw a marginal decrease of 1%. It is noteworthy that the U.S. Securities and Exchange Commission (SEC) listed these tokens, along with nine others, as unregistered securities in the two lawsuits.
BTC and ETH Excluded from SEC Filings, Market Analysts Bullish on Bitcoin’s Prospects
In the midst of the recent lawsuits that have shaken the crypto industry’s biggest players, the U.S. Securities and Exchange Commission (SEC) made no mention of Bitcoin (BTC) and Ethereum (ETH) in its legal filings. This omission has been interpreted as a reassuring indication that regulators view both tokens as commodities, providing a sense of relief for investors.
According to Vetle Lunde, senior analyst at crypto research firm K33 Research, the initial sharp decline in BTC following the Binance lawsuit was an overreaction. Lunde confidently stated that Bitcoin is classified as a commodity, emphasizing that Americans have numerous options to purchase BTC through various exchanges, exchange-traded funds, payment apps, and more. Although liquidity may consolidate further towards platforms like Coinbase and Kraken, Lunde believes the market should not experience a 5% crash based on these developments.
Furthermore, a market report by Edward Moya, senior market analyst at trading platform Oanda, suggested that the SEC’s crackdown on alternative coins (altcoins) could potentially benefit Bitcoin. Moya argued that Bitcoin is becoming an attractive trade option as many crypto investors might opt to abandon most altcoins and stick with the digital currency that has proven itself since the inception of cryptocurrencies.