Decrypt Senior Writer Stacy Elliott joins Yahoo Finance to discuss solana's surge and the latest in the broader crypto market.
- All right, we are about 15 minutes to the closing bell. I want to pull up Bitcoin right now. I feel like I want to say, can I get an amen? Can I get Bitcoin in here? Because this morning, it looked like we were going to have somewhat of a recovery. Bitcoin above 58,000 is falling again. I want to talk about why this might be happening and so much more because we have India taking potential that people are misunderstanding. Perhaps that might be a problem for crypto investors.
Let's bring in Stacy Elliott from Decrypt. It's good to have you here. Senior writer at Decrypt. And Stacy, very simply put, is what we're watching happen just with Bitcoin today a result of the hearing on Capitol Hill in which Jay Powell talked about, as well as Secretary Yellen and the Banking Committee, they talked about we're going to get the Federal Reserve's digital currency report. There's also this kind of growing momentum for the word regulation. Is it uncommon?
STACY ELLIOTT: . Yeah I mean, I think it's been a tough season for Bitcoin and regulations. I mean, we got the futures ETF but then we got know on the spot ETF. The infrastructure bill was signed. You know, that's kind of been out there for a while, but there's a whole new wave of panic and, you know, confusion over what that's actually going to mean. I definitely think what's happened on the Hill the other day has something to do with it. So yeah, we're seeing Bitcoin struggle to kind of regain the highs that we've seen recently.
- And let me ask you about ETFs. We finally got a Bitcoin ETF in the US. I believe it was only yesterday we had a filing for an Ethereum ETF and plus Grayscale, Solana trust that is launching finally with $9 and 1/2 million under management. But can you put together any kind of picture about the state of ETFs because Gary Gensler has said that he wants them to be based on futures. But even this new Ethereum, which is based on futures, industry analysts are saying probably a long shot at least for now.
STACY ELLIOTT: Yeah. I mean, we've been seeing kind of diminishing returns with how well these ETFs have done, the Bitcoin future ones. You know, the first one, BITO, big splash, picked up lots of investments when it first came out. The second one did not as well. I think it's maybe got maybe half as many assets under management.
The third one that we saw, still not doing quite as well. So I wouldn't be surprised if we wind up seeing something similar with the Ethereum one. There's an appetite to get into these spot ETFs, but it seems like regulators just aren't ready for that yet.
- When you mentioned chaos and panic, I was thinking, how did you know my middle name? But I am curious, when it comes to India, are investors reacting with panic and some chaos, misunderstanding? What the next legislative step is going to be when it comes to cryptocurrencies in that country?
STACY ELLIOTT: Yeah, it's been kind of interesting watching this play out because this actually got introduced back in January. It's just that it's now coming onto the docket and being actively discussed by legislators there. The big phrase that's kind of been inspiring a lot of this confusion is private cryptocurrencies.
So it's not clear whether they mean things like Monero or other kinds of coins that are basically set up so that you could completely obscure who you are and where the money's coming from or if it means ones that are issued by private companies like Tether or USDC which is issued by Circle.
So I think we're seeing there a little bit of what we've also seen here in the US, that some of this initial legislation coming out creates panic because perhaps the legislators don't really know how to word this. They're a little imprecise with their language. And so yeah, I think that's a lot of what we're seeing out of India right now.
- Well, I want to cut to the Wi-Fi interactive where we have a heat map of the crypto space. And this is over the last 24 hours. There's a lot of green there. Bitcoin, you can see that's down 1% but a lot of green. Shiba Inu, that is up 16%. We do a five day chart. It's up 28.9%. A lot of other tokens in there. Is the worst over for the price action in crypto? Is it just a Bitcoin story that kind of holding the market back or what are your views here?
STACY ELLIOTT: I mean, it's hard to say. There are some whales in the market that I think are hoping they can still shake out some folks who are going to be scared by prices softening a little bit from the all time highs we've seen recently. But it's hard to say. Reading the tea leaves is, as I'm sure you know, quite tough.
- Yes, they are. I'm just wondering, what projects are-- what kind of inquiries are you making like right now? What kind of reporting are you doing in the crypto industry? Any stories that are catching your attention? You got the floor here.
STACY ELLIOTT: So we've been taking a closer look at this Grayscale Solana Trust today. It's been really interesting to see what Grayscale Investments has been doing this year. You know, they came out with a trust for Decentraland which is completely based in the metaverse. We've also seen them put out a DeFi index because you know, they know that investors want exposure to these things.
They don't necessarily want to have to create an avatar and enter the metaverse themselves or buy some land. Although that is, of course, what the metaverse is for. But they want exposure. They want some kind of investment product that's going to potentially grow and appreciate as this continues to develop.
So I think this is just more of what we've been seeing from Grayscale this year. But I think it's definitely a mark of, you know, maturity and interest from institutional investors for Solana, that now there's this trust and there was enough interest in this that they want to debut this product.