Ethereum Classic Soars 24% in Massive Rebound: What's Driving the Rally?

ETC ETC/USD, the native asset of Ethereum Classic, enjoyed a remarkable rebound on Wednesday as its price rose from $15.64 to a huge green daily candlestick.

What happened: Dubbed the Ethereum spin-off ETH/USD, ETC is up over 24% in the past 24 hours, outpacing intraday gains at 19 $.52.

According to blockchain analytics firm Santiment, ETC is seeing a massive rally. Not only is trading volume unusually high, but there is also a massive influx of shorts by traders on the exchanges, suggesting that this rally could extend further.

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It seems that the recent sudden price increase could be partly due to a short squeeze. This usually happens when a large number of traders make bearish bets on an asset and its value rises instead.

Investors seem to be anticipating a possible regulatory crackdown on Ethereum later this year, which could explain why Ethereum Classic's price is surging.

Last year, Ethereum underwent a major overhaul known as The Merge, moving from a proof-of-work (PoW) network to a proof-of-stake (PoS) network. ). These upgrades aim to make the platform faster and more reliable, although new staking features mean it could be subject to increased government scrutiny, particularly in the US, where the SEC considers Ethereum to be financial security. Therefore, it is possible that the recent price spike was driven by anticipation of upcoming regulations.

Price Action: At the time of writing, ETH was trading at $12,544, up 2.7%. ETC was trading at $19 for the past 24 hours, according to Benzinga Pro.

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