Spot Ethereum ETFs Archives

25th April 2024

SEC Anticipated To Reject Spot Ethereum ETFs In Upcoming Decision, ETH Price Takes 5% Hit

Over the past 24 hours, Ethereum (ETH), the second-largest cryptocurrency by market capitalization, has experienced a significant 5% price drop. This drop comes amid growing speculation that the highly anticipated Ethereum ETFs will likely be rejected by the US Securities and Exchange Commission (SEC) in the upcoming May deadline.

US Bitcoin ETF Issuers Brace For SEC’s Expected Denial

According to a recent Reuters report, various US Bitcoin ETF issuers and firms anticipate the SEC’s denial of their applications to launch ETFs tied to the price of ETH.

These expectations have been fueled by “discouraging meetings” between the applicants and the regulatory agency in recent weeks, as disclosed by four individuals familiar with the matter.

Prominent investment firms such as VanEck, ARK Investment Management, and seven other issuers have submitted filings with the SEC to list ETFs that would track the spot price of Ethereum.

As the first in line, VanEck’s and ARK’s applications are subject to the SEC’s decisions by May 23 and May 24, respectively.

The sources involved in the meetings between Bitcoin ETF issuers and the SEC have reported that the discussions have been primarily “one-sided,” with agency staff not engaging in substantive details about the proposed products.

This starkly contrasts the intensive and detailed discussions between issuers and the agency before the SEC’s landmark approval of spot Bitcoin ETFs in January.

The issuers argued during the meetings that the approval of spot Bitcoin ETFs and Ethereum futures-based ETFs by the SEC in October set a precedent for the spot ETH products. They also made efforts to address potential regulatory concerns.

Despite their arguments, the report notes that the SEC staff did not clarify specific concerns or engage in meaningful dialogue, further indicating a possible denial of the requests.

Setback For Crypto Industry

If these expectations materialize, it would be a setback for the cryptocurrency industry, which had hoped that the approval of spot Bitcoin ETFs would pave the way for similar products and contribute to the mainstream adoption of cryptocurrencies.

According to Todd Rosenbluth, head of ETF analysis at data firm VettaFi, the likely delay in approval or rejection until later in 2024 or beyond has left the regulatory landscape uncertain.

While some issuers have expressed their intention to submit additional disclosure paperwork to continue the conversation with the SEC, the overall sentiment indicates a growing belief that the applications will be rejected.

VanEck CEO Jan van Eck has already stated that the company’s application will likely be rejected, while ARK Investment Management has yet to comment.

Rejected Ethereum ETFs Could Spark Potential Court Battles

Several applicants expect the SEC to cite broader issues, such as the nature and depth of statistical data on the underlying ETH market, as reasons for their decision in the event of ETF rejections.

Matt Hougan, chief investment officer at Bitwise Asset Management, which has filed for a spot in Ethereum ETF, believes that the SEC may require more time to observe Ethereum futures and gather additional data.

Industry insiders further speculate that rejecting Ethereum ETFs could potentially lead to legal action, with one source suggesting that the courts may get involved before Ethereum ETFs eventually become a reality.

The anticipated rejection has already influenced the price of Ethereum, with Hong Fang, president of the crypto exchange OKX, stating that the cryptocurrency is experiencing downward pressure as market participants factor in the likelihood of a negative outcome.

Ethereum ETFs

Currently, ETH is trading at $3,100, further highlighting the cryptocurrency’s persistent downtrend over broader time frames. Over the past fourteen and thirty days, the token has experienced significant declines of 12% and 14%, respectively.

Featured image from Shutterstock, chart from TradingView.com

2nd April 2024

Ethereum And Altcoins Crash: Why Is This Analyst Super Bullish?

Altcoins like Ethereum, Cardano, Solana, and the rest might be lower at spot rates. However, according to one analyst who sees a parallel in the current formation to the 2020 market cycle, they are gearing up for a potential surge.

In a post on X, the analyst says that often, after a period of accumulation and a retest of previous highs, altcoins tend to be volatile. The crypto analyst also notes that Bitcoin has pulled back from its all-time highs and is preparing for a possible retest of this level registered in March.

Bitcoin accumulating | Source: Analyst on X

Though altcoins have been decimated, looking at price action in the past 24 hours, altcoins are on a bullish path, similar to the last cycle registered in 2020. The analyst says Bitcoin will catalyze the altcoin swing to fresh levels and valuations.

Will Altcoins Repeat The 2020 Cycle?

For now, it is hard to predict the exact valuation of top altcoins. However, the analyst notes a similar formation in the current price action.

When altcoins consolidated after surging, prices tended to recover strongly. This spike was evident, especially once Bitcoin broke through critical liquidation levels and entered “price discovery” or fresh all-time highs.

Currently, Bitcoin is in this position. The coin is trading lower and cooling off from all-time highs. Even after higher highs last week, bulls didn’t break the $71,700 level in the daily chart. With BTC collapsing, altcoins also fell, with Ethereum, Solana, and top coins slipping below support levels.

Will Ethereum And Other Altcoins Bounce Back Strongly?

The altcoin season might come earlier this time, especially once Bitcoin recovers. Possible triggers include the upcoming Bitcoin halving event. Analysts claim that halving will likely create a supply crisis, causing scarcity. If institutions funnel the same demand level, BTC will likely rip higher, breaking $71,700 and even $73,800 all-time highs.

Beyond this, upcoming network upgrades in Ethereum, like the recently mentioned “Purge” and Firedancer integration in Solana, might trigger demand. Developers are working towards Voltaire in Cardano. All these changes plan to make the top smart contracts platform more reliable and enhance performance.

Besides network upgrades, analysts are considering the possible approval of spot Ethereum exchange-traded funds (ETFs). If the United States Securities and Exchange Commission (SEC) approves this product, ETH might benefit by lifting others. It might also accelerate the drafting of fitting laws, especially now that BlackRock thinks tokenization and real-world assets (RWAs) are the future of finance.

5th March 2024

If Bitcoin Clears $70,000, How Fast Will Ethereum Ease Past $5,000?

As Bitcoin surges towards its all-time high (ATH) of nearly $70,000, analysts are closely watching Ethereum, the world’s second-largest cryptocurrency, wondering how quickly it will follow suit and break its record ATHs of approximately $5,000 printed in late 2021.

How Will Ethereum React When Bitcoin Breaks Above $70,000?

One analyst, posting on platform X, highlights the difference in the two coins’ positions compared to the last time Bitcoin broke above 2017 highs of $20,000 in December 2020. Then, Ethereum was trading at $600, a full 57% below its previous ATH of about $1,400.

As Bitcoin nears its record peak of around $70,000 registered in December 2021, Ethereum is approaching $4,000. However, the difference between then and now is that ETH is about 36% shy of its ATH of around $5,000.

The question in the analyst’s mind is, considering historical performance, how fast ETH will ease past $5,000. When Bitcoin broke above $20,000 in late December 2020, the analyst notes that it took approximately two months for ETH to sweep past $1,400 and record new highs.

The boom after this breakout lifted ETH to around $5,000, accelerated mainly by retail activities cycling around decentralized finance (DeFi) and non-fungible token (NFT) minting.

Looking at the Ethereum price action in the daily chart, it is clear that buyers are in control. ETH prices, CoinMarketCap data reveals, are up roughly 7% in the past 24 hours and 15% in the previous week. However, how quickly ETH might repeat the prior 2020-2021 feat remains to be seen.

Exploring ETH’s Chances

Like in the past, the Ethereum price action benefits from the Bitcoin expansion. The revival in Bitcoin prices has seen capital flow to Ethereum, priming its broader ecosystem comprising DeFi and NFT protocols. DeFiLlama data shows that Ethereum manages over $56 billion worth of assets.

Notably, almost all top DeFi protocols in Ethereum, including Lido, Maker, Uniswap, and EigenLayer, have posted strong inflows in the past day, week, and month.

Ethereum DeFi protocols pulling in capital | Source: DeFiLlama

Aside from market-related factors, Ethereum prices are also steadied by hopes around the eventual approval of a spot Ethereum exchange-traded fund (ETF). BlackRock is among the leading asset managers to file with the United States Securities and Exchange Commission (SEC).

However, the agency postponed a ruling on BlackRock’s application for a spot Ethereum ETF, citing concerns about the network’s new proof-of-stake consensus mechanism. The SEC expressed worries that staking, a core aspect of proof-of-stake, could create opportunities for manipulation.

The clear reservation regarding proof-of-stake cast a shadow on Ethereum’s near-term outlook despite the current uptick in prices. Still, the community finds relief realizing that the Commission rejected approving a spot Bitcoin ETF for roughly ten years before January 2024.

31st January 2024

Ethereum to $20,000: Analyst Sees Spot Ethereum ETFs Fueling Bull Run

A crypto analyst, Eric, believes Ethereum (ETH) could spike to $20,000 in the upcoming bull run. The analyst said the potential launch of spot Ethereum exchange-traded funds (ETFs) in the United States will propel this upswing.

Ethereum To $20,000 Possible

In a post on X, Eric cited Ethereum’s historical tendency to mirror Bitcoin (BTC), albeit with a one-cycle lag. In the previous bull market, the analyst noted that Bitcoin surged 22-fold from $3,100 to $69,000. Therefore, if Ethereum follows a similar trajectory, reaching $20,000 would be a realistic possibility.

As the analyst noted, Ethereum’s recent bear market bottom of $880 in 2022, if extrapolated using the 22x growth rate seen in BTC, places the coin at $19,360. However, the analyst believes Ethereum might surpass expectations, making $20,000 a base and a psychological round number to monitor closely.

Supporting this forecast is the possible approval of a spot Ethereum ETFs. Like the spot Bitcoin ETF, this authorization will likely attract institutional investors and significantly boost Ethereum prices and liquidity. Institutional investors can gain exposure to Ethereum through these complex derivative products without the complexities of directly trading or storing the coin.

While the optimism remains, the United States Securities and Exchange Commission (SEC) will likely follow the same path it took before approving the first spot of Bitcoin ETFs in January. For context, the strict agency failed to approve any spot Bitcoin ETF for over ten years, citing market manipulation risks and the absence of proper monitoring tools.

Will The US SEC Approve A Spot Ethereum ETF?

However, in a recent statement by The Block, Standard Chartered, a global bank, said the US SEC will likely approve Ethereum ETF’s first spot in May 2023. By then, the bank added, ETH prices will be trading at around $4,000, propelled by general market optimism.

The bank notes that the failure of the agency to classify ETH as a security further adds weight to this expectation. At the same time, Grayscale Investments, which is issuing Grayscale Ethereum Trusts (ETHE), wants to convert this product into an ETF. Each share traded at around $20 as of January 30.

ETHE share price | Source: Grayscale

Earlier, Grayscale won against the US SEC’s arguments, wishing to prevent the conversion of their Bitcoin Trust into an ETF. This win set the ball rolling for the eventual approval of the first spot Bitcoin ETFs in the United States.

Additionally, the fact that Ethereum Futures ETFs were recently approved and listed on the Chicago Mercantile Exchange is a net positive, paving the way for a potential listing in May 2024.

31st January 2024

Ethereum ETFs Approval Date Set For May 23, Forecasts Suggest ETH Could Reach $4,000

The Securities and Exchange Commission (SEC) is poised to follow a similar approach to approving spot Bitcoin (BTC) exchange-traded funds (ETFs) for spot Ethereum ETFs, with the expectation that approval will be granted on the initial final deadline of May 23, as per Standard Chartered Bank analysis.

Ethereum ETFs Face Delays, Approval Remains Likely

According to a report by The Block, Geoffrey Kendrick, head of forex and digital asset research at Standard Chartered Bank, stated that they expect pending applications for spot Ethereum ETFs to be approved on May 23, which is considered the equivalent date to January 10 for Bitcoin ETFs.

Furthermore, Kendrick predicts that if Ethereum prices follow a similar trajectory to Bitcoin leading up to ETF approval, Ethereum could trade as high as $4,000 by the specified date.

Kendrick further supports the approval of spot Ethereum ETFs based on the SEC’s classification of ether as a non-security in its legal actions against crypto companies.

Additionally, the fact that Ethereum is listed as a regulated futures contract on the Chicago Mercantile Exchange (CME) adds weight to the expectation of approval.

Following the same line, Scott Johnsson, a financial lawyer, offered insights into the potential roadmap for Ethereum ETFs. Johnsson emphasized that while long-term approval for spot Ethereum ETFs is highly likely, there may be short-term delays due to ongoing regulatory actions involving Coinbase/Binance securities exchanges.

Shorter Path For ETH ETF Approvals?

Johnsson highlighted the regulatory path from a plain spot digital asset to a spot ETF offering, using Bitcoin as an example. Johnsson noted that the process for Bitcoin took seven years, involving multiple steps and disapprovals along the way.

However, Johnsson noted that the timeline for Ethereum is compressing, with applications open for both futures ETFs and spot ETFs. He suggested certain prerequisites that Johnsson believes may no longer be necessary for spot approval, such as Step 3, which requires the SEC to issue a formal 19b-4 approval for the futures ETF.

Johnsson highlighted two key factors to understand the SEC’s current approach to future approvals, including Ethereum. Firstly, he discussed the threshold question in the context of the Grayscale ruling, which focused on correlation analysis.

Secondly, Johnsson emphasized the SEC’s view, as bounded by the recent BTC approval order, which considers correlation with the CME, a lengthy sample period, intra-day trading data, and consistency throughout the sample period.

While the specific threshold for sufficiency remains unknown, the correlation analysis for Bitcoin is within an acceptable range. Therefore, it is expected that Ethereum will likely meet this threshold in the foreseeable future, Johnsson suggests.

Once the required level of correlation is achieved, Johnsson believes that approval for spot Ethereum ETFs is likely to follow shortly after that, with May being the expected month of approval.

Overall, industry analysts and experts suggest that the SEC’s approval of spot Ethereum ETFs is a matter of time, barring any major legal shifts.

Ethereum ETFs

ETH is currently trading at $2,370, up more than 2% in the past 24 hours and more than 7% in the past seven days, following Bitcoin’s lead.

Featured image from Shutterstock, chart from TradingView.com

26th January 2024

Analyst Thinks Ethereum Will Explode To $15,000, Cites Favorable Technical Formation

A crypto analyst, Elja on X, predicts that Ethereum (ETH) will reach a staggering $15,000 by 2025 based on technical analysis. The analyst argues that the current bearish sentiment in the crypto market is “temporary.”

Moreover, Elja notes that the second most valuable coin by market cap follows a similar fractal pattern that fueled its previous major price rally in 2021.

ETH to $15,000 | Source: Elja on X

Is Ethereum Ready To Rip Despite The Current Consolidation?

Sharing a screen grab of the current ETH price action, Elja says most people in crypto are “short-sighted” and only focus on immediate price movements. In the analyst’s assessment, traders should look at the long-term to understand the overall price pattern.

Thus far, Ethereum, like Bitcoin (BTC), remains under pressure and struggling to break above immediate resistance levels. Looking at the development in the daily chart, ETH is back at a critical support level of around $2,200. Notably, the coin is down 20% from January 2024 highs of about $2,700.

ETH is under pressure, at least in the short to medium term. As it is, the coin follows the technical candlestick arrangement visible in Bitcoin.

The altcoin downtrend appears to have been triggered by events following the approval of spot Bitcoin ETFs by the United States Securities and Exchange Commission (SEC). As an illustration, Bitcoin fell from around $47,000 to below $40,000 this week, weighing down altcoins, including Ethereum.

On-chain data shows that Grayscale Investments has been unloading thousands of coins behind Grayscale Bitcoin Trust (GBTC). Subsequently, there has been a sell-off in Bitcoin and across the altcoin scene. The situation has been made worse for Ethereum following the United States SEC’s decision to postpone the approval of spot Ethereum ETFs.

While these developments have negatively impacted sentiment, Elja believes they will not derail Ethereum’s long-term growth trajectory. Specifically, the analyst notes that ETH is consolidating, a “healthy sign.”

ETH To $15,000: Will Fundamental And Technical Factors Help?

Elja added that when crypto prices consolidate, it could suggest that whales are accumulating their position. Once this ends, ETH prices could trend higher. From the analyst’s chart, the coin will break above $5,000 to $15,000 in the coming sessions.

When making this prediction, the analyst compared the Ethereum price action to the fractal pattern that propelled ETH from around $200 to $4,800 in 15 months from 2019 to 2021. Extrapolating from past price action, Elja believes Ethereum is on a similar path. Based on analysis, the coin will likely break above November 2021 peaks.

Ethereum burning | Source: Ultrasound Money

Beyond technical factors, ETH supporters cite the decreasing issuance rate. According to Ultrasound Money data, the network has been burning thousands of ETH, reducing supply. Additionally, Larry Fink, the CEO of BlackRock, believes Ethereum will be the choice network for tokenizing real-world assets (RWAs) in the years ahead.

16th January 2024

Ethereum Trouncing Bitcoin, ETH/BTC Ratio Bouncing Higher: Will This Trend Continue?

Amidst a volatile crypto market, Ethereum (ETH) is gaining momentum, outperforming its long-time rival Bitcoin (BTC). According to Kaiko data, the ETH/BTC ratio has steadily risen, rebounding from multi-year lows.

ETHBTC ratio trend | Source: Kaiko on X

ETH/BTC Ratio Rising, ETH Momentum Building

The ETH/BTC ratio technically gauges market sentiment towards these two leading crypto. The recent rebound indicates investors are increasingly bullish on Ethereum’s potential relative to Bitcoin.

This upward trajectory is fueled by growing optimism surrounding the potential approval of spot Ethereum ETFs and the general confidence that markets will trend higher in 2024. The prospect of this product entering the market has also injected fresh energy into the ETH ecosystem, lifting the second most valuable coin by market cap.

After protracted lower lows, the ETH/BTC ratio began rising immediately after the United States Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETFs last week. This unexpected shift, analysts observe, is primarily because of increasing confidence in the SEC approving a similar product for ETH.

Spot Ethereum ETFs, which would provide direct exposure to the Ethereum market, would make it easier for institutional investors to benefit from the volatility of ETH. So far, the SEC has approved an Ethereum Futures ETF, which, unlike the spot ETF, tracks an index, not the direct price of this asset.

Blackrock is among the leading Wall Street giants interested in issuing a spot Ethereum ETF. Considering its history of success, the decision by one of the world’s leading asset managers to apply for this product is an endorsement of its prospects. Earlier, Larry Fink, the CEO of BlackRock, said Ethereum, despite its scaling challenge, might spearhead the tokenization drive in the years ahead.

US SEC Yet To Clarify Whether Ethereum Is A Commodity Or Security

Even so, the SEC has yet to clarify whether ETH, a coin pre-mined with some assets distributed to the Ethereum Foundation, is a commodity like Bitcoin. Earlier, Gary Gensler, the chairperson of the SEC, was cornered by the United States policymakers to give the agency’s stand on the coin but didn’t.

Nonetheless, with the prospect of spotting Ethereum ETFs and the dominance of Ethereum in decentralized finance (DeFi) and non-fungible tokens (NFTs), ETH will likely continue outperforming BTC in the coming months. Price action data shows that ETH is already up 20% versus BTC in the past trading week.