In recent news, the newly formed Crypto Task Force by the SEC made headlines after engaging in discussions with the CEOs of Jito Labs and Multicoin Capital. The focus of the meeting revolved around the possibility of incorporating staking in crypto exchange-traded products (ETPs).
Reports indicate that the meeting centered on two primary topics. The first topic deliberated whether staking could become a component of crypto ETPs and the potential approaches to its implementation. The SEC put forward the argument that integrating staking into ETPs would be advantageous for investors and aid in the growth of native networks.
Regarding staking, the task force is contemplating allowing a segment of the assets to be staked through service providers operating validators, alongside permitting prompt redemptions. Moreover, there is consideration for creating a liquid staking token for the staked assets.
Historically, the SEC has maintained a cautious stance on staking within ETFs or ETPs due to concerns over the “unbonding period.” This period could impede the redemption process for investors and potentially trigger tax-related challenges. Nevertheless, this development signals positive news for crypto assets that have been navigating significant regulatory uncertainties from previous administrations.
Implications for JTO?
Predictably, the meeting exerted a substantial impact on Jito’s native token, JTO. Following the session, Jito [JTO] surged by 16.67%, reaching a two-month high of $3.58.
As of the current moment, Jito has retraced slightly and is trading at $3.1. This price movement represents a 28.87% increase on the weekly charts, further extending its bullish trajectory by 20.04% on the monthly charts.
The recent price upsurge has propelled strong upward momentum in JTO’s favor, with buyers asserting dominance in the market.
The prevalence of buyers’ dominance is reflected in the negative spot netflows for Jito observed over the last 24 hours.
A shift to -880.8k in netflows implies a higher volume of exchange outflows compared to inflows, indicating active accumulation of the asset by investors, who are storing JTO in private wallets or cold storage.
Furthermore, a majority of active participants have opted for long positions amidst this scenario.
Based on data from Coinalyze, long positions in JTO hold a 53% share of the futures contracts, while shorts account for 46% at the current time. The prevalence of long positions signifies trader optimism and anticipation of further price appreciation.
This optimistic sentiment is reinforced by the recent transition in weighted sentiment from bearish to bullish.
After a six-day spell within the negative zone, the weighted sentiment has now turned positive, indicating a growing bullish sentiment among participants towards the cryptocurrency.
What Lies on the Horizon?
As the SEC nurtures a more collaborative relationship with the crypto community, the market stands to benefit, exemplified by the sudden price surge witnessed in Jito.
Hence, should the existing market conditions remain stable, JTO and other assets are poised to sustain gradual growth trends.
In the near future, JTO could potentially reclaim $3.7 and venture towards the $4 mark. However, profit-taking opportunities for sellers could prompt a dip in JTO’s price below $3 if they capitalize on the current uptrend.