Ethereum’s native tokenether (Eth)winning space against Bitcoin
As the impending genuis law probably prohibits dividend-bearing stableecoins that promise interest-like returns, according to Markus Thielen, founder of 10x research.
The Binance-Listed Ether-Bitcoin relationship representing Ether’s BTC-denominated price rose over 5.96% to 0.02670 Tuesday and registered its best benefit since May 13, according to Data Source Trading.
The recovery marked a bullish resolution for the game in several weeks and suggests that ether better than Ether Outperformance in the future. Ether’s dollar-denomined price rose over 4%and topped $ 3,100 for the first time since February.
According to Markus Thielen, founder of 10x research, the most important driving force for Ether’s price increase is apparently the growing expectation that the Genuis Law or the US StableCoin Bill will pass, limiting US StableCecoin issuers from paying interest.
“It would potentially strengthen the importance of Ethereum within the digital active ecosystem,” Thielen said in a client note shared with Coindesk.
Thielen added that the Genuis Act has set the limelight on Ethena’s $ 5 billion synthetic dollar that achieves Delta cover or cash and carries arbitrage by mapping eternal futures corresponding to the amount of ETH received from users as security. This is how it generates dividends on USDE.
The prolonged theory is that the short-circuit operation adds to bearish pressure on the futures market and caps base, the gap between futures and spot prices.
“Ethena currently represents about 4% of Ethereum’s open interest rate of $ 26 billion, and by consistently selling futures, it has exerted downward pressure on ETH prices,” Thielen said.
Ethhena has already reached the US Securities and Exchange Commission (SEK) To seek clarity on synthetic dollars, such as USDE. The team allegedly claimed that the synthetic dollar acts as a payment instrument rather than a security and falls beyond the scope of the Genuis Act and the stable law that regulates the payment stablecoin issuers.
Ethena is headquartered in Lisbon, Portugal, with new dollar flows that primarily come outside the United States, so it is left to see how it fits the developing regulatory image in the United States
“If ethena were to comply with the US StableCoin Bill, it could be forced to stop buying Ethereum completely. However, the market can interpret this dynamic different-ENA-USDT continuing to gather, supported by increasing Ethereum financing rates,” Thielen said.
Genius Act, which received Senate’s approval in June with Bipartisan support, is expected to go against a floor vote in parliament per year. Thursday.
Read more: The US Senate Passes Genius Act to regulate stableecoins, marking the crypto industry’s victory
