Ethereum (ETH) is currently facing a critical test as it approaches the key support level of $3,360. This price point has emerged as a significant marker in recent trading sessions, with market participants closely watching to see if ETH can maintain its footing or if further declines are imminent. 

The $3,360 level represents a crucial battleground between bullish and bearish forces, and its outcome could set the tone for Ethereum’s short-term price trajectory. In this article, we will explore ETH’s potential price implications in the event of a rejection or a breach with the help of technical indicators.

At the time of writing, Ethereum was trading at around $3,387 and was down by 1.62% with a market capitalization of over $407 billion and a 24-hour trading volume of over $11 billion. Its market capitalization is down by 1.52%, while its trading volume is up by 32.02% in the past day.

Will $3,360 Support Hold Or Break?

It can be observed on the 4-hour chart that ETH’s price has experienced a drop toward $3,360 and is trading below the 100-day Simple Moving Average (SMA). Currently, the price is moving in a consolidating manner, which is slightly above this level.

Additionally, the 4-hour Relative Strength Index (RSI) indicates that Ethereum’s price may breach below this support level and continue in its downtrend as the RSI line has dropped below 50% and could drop into the oversold zone.

Taking a look at the 1-day chart, it can be seen that ETH is attempting to drop below the 100-day SMA. Although the price of ETH is still bullish, based on current price action it may tend to fall further in the long run.

Finally, the 1-day RSI indicator signals a bearish trend ahead as the signal line has already dropped below 50% and is heading toward the oversold zone. From the price analysis and the formation of technical indicators, it can be suggested that the crypto asset may likely break below the $3,360 support.

Ethereum’s Path Beyond $3,360

Exploring ETH’s prospects and strategies beyond $3,360, it was revealed that if the price of ETH breaks below this level, it may move lower to test the $3,051 support level and probably move on to test the $2,865 support level and other levels below if the price breaches this level.

However, if ETH’s price faces rejection at the $3,360 support level, it will begin to move upward toward the $3,659 resistance level. Should the digital asset breach this support level, it may move further to test the $3,975 resistance level and possibly other higher levels.

Featured image from Adobe Stock, chart from Tradingview.com

The US Securities and Exchange Commission (SEC) has intensified its legal battle with the crypto industry by filing a lawsuit against ConsenSys, a blockchain firm known for its MetaMask wallet product and its focus on the Ethereum network. 

The SEC alleges that ConsenSys violated federal securities laws by operating as an unregistered broker and dealer while offering services for “crypto securities,” amassing fees exceeding $250 million. 

SEC Lawsuit Against ConsenSys 

The SEC’s lawsuit against ConsenSys echoes similar complaints against other crypto firms such as Coinbase and Kraken. However, what sets this lawsuit apart is the context surrounding ConsenSys’ response to the SEC’s actions. 

In April, ConsenSys filed a lawsuit against the SEC after receiving a Wells notice seeking clarity on whether Ethereum should be classified as a security. Just recently, ConsenSys announced the closure of the SEC’s “Ethereum 2.0” investigation, interpreting it as an indication that Ethereum fell outside the agency’s jurisdiction. 

Notably, the SEC did not name Ethereum as one of the unregistered securities offered by ConsenSys in Friday’s filing, which may have led to the approval of the Ethereum ETF applications by the world’s largest asset managers on May 23.

Crypto Industry’s Regulatory Battle

ConsenSys, founded by Joseph Lubin, one of Ethereum’s developers, distinguishes itself from previous SEC targets. Rather than operating as an exchange, ConsenSys focuses on software development, including the MetaMask digital wallet. 

The SEC’s lawsuit argues that the firm violated securities laws by enabling the “swapping” of crypto assets through MetaMask. Particularly, the agency has targeted Ethereum staking services, namely Lido and Rocket Pool, alleging that their tokens, stETH and rETH, respectively, are unregistered securities.

The SEC further claims that ConsenSys facilitated over 36 million crypto asset transactions, including at least 5 million involving what the agency deems to be securities. 

Previously, the SEC had brought similar charges related to staking against Kraken, resulting in a $30 million settlement, while Coinbase has contested the charges.

While the new SEC complaint against the blockchain firm does not classify Ethereum as a security, it represents another front in the SEC’s ongoing campaign against major players in the crypto industry. 

Many within the crypto community may view this as a partial victory, given the absence of Ethereum’s inclusion as an unregistered security. However, the lawsuit further highlights the regulatory uncertainties surrounding the industry’s top companies. 

ConsenSys, currently engaged in an ongoing lawsuit against the SEC in Texas, criticized the agency’s actions, accusing it of pursuing an “anti-crypto agenda” through arbitrary enforcement actions and regulatory overreach.

At the time of writing, ETH was trading at $3,777, down 2.3% in the past 24 hours as the crypto market continues to experience significant selling pressure. 

Featured image from DALL-E, chart from TradingView.com 

Crypto trader Duncan has explained why he is “extremely long” on Ethereum (ETH) despite the crypto token’s recent drop to around $3,400. He emphasized the Spot Ethereum ETFs, which he believes could spark a significant rally for ETH.

A ‘Significant Upside Repricing’ Could Be On The Horizon ForTHEEthereum

Duncan mentioned in an X (formerly Twitter) post that he believes that the market is way too bearish at the moment and that there could be a “significant upside repricing” for Ethereum if the Spot Ethereum ETF inflows are “anything but horrible.” He further explained why he thinks the Spot Ethereum ETFs will be a huge success, contrary to what some might think. 

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First, he noted that asset managers view the crypto ETF space as a “new frontier” that could generate billions in management fees for them over the next ten years. He highlighted how BlackRock has had its most successful product launch ever with its Spot Bitcoin ETF, which he claims is already generating $45 million in fees yearly, just six months after its launch. 

Based on this, Duncan stated that the Spot Ethereum ETFs provide these asset managers another “massive opportunity” to launch a product that could bring them similar success to the Spot Bitcoin ETFs, generating hundreds of millions in fees. Duncan remarked that the Spot Ethereum ETFs are “almost as big as the Bitcoin ETF given the base management fees and the future ability to clip a fee off the staking yield.”

Duncan further alluded to an interview Scott Melker (aka Wolf Of All Streets) had with VanEck’s Head of Digital Asset Research, Matthew Sigel, to emphasize how these asset managers feel about the Spot Ethereum ETFs. From what was said during the interview, Duncan noted how VanEck is betting on the Spot Ethereum ETFs to spark a “reflexive rally” in ETH, which Sigel claimed could make them more money. 

Spot Ethereum ETF Issuers Could Provide A Narrative For ETH

Duncan tried to counter the argument made by crypto figures like Andrew Kang, who argued that Ethereum had no narrative and that the Spot Ethereum ETFs might not succeed because of that. Duncan stated that asset managers like BlackRock and VanEck can “literally start the narratives themselves.”

He added that this narrative could be about BlackRock’s Real World Assets (RWA) on-chain, VanEck’s new stablecoin, or the asset managers’ “open app store” thesis. Dunan said the market could witness a “massive ETH rally” when these narratives are mixed with some “good flows and ETH’s extremely reflexive characteristics.”

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The crypto trader admitted that this could take time but opined that it is naive to think that these asset managers won’t deploy significant resources to attract inflows to their Spot Ethereum ETFs. 

Crypto analyst and trader Tyler Durden shared a similar sentiment when he mentioned that Ethereum reaching $10,000 was the “most asymmetric bet” in crypto today. He claimed that Wall Street had put so much effort into ensuring that the Spot Ethereum ETFs were approved, and now, they will make as much money from it while pumping ETH. 

Featured image created with Dall.E, chart from Tradingview.com