Standard Chartered Bank has projected that the U.S. Securities and Exchange Commission (SEC) will give the green light to spot Ethereum exchange-traded funds (ETFs) by May 23, The Block reported Jan. 30, citing a research report.
This expectation mirrors the timeline and approach previously seen in the SEC’s approval process for spot Bitcoin ETFs.
Ethereum’s classification
According to Geoffrey Kendrick, the head of forex and digital assets research at Standard Chartered, the approval of Ethereum ETFs seems likely given the SEC’s previous stance on ETH.
Unlike certain cryptocurrencies that have been classified as securities in legal actions against crypto firms, Ethereum has avoided such categorization. Additionally, ETH’s presence as a regulated futures contract on the Chicago Mercantile Exchange bolsters the likelihood of approval.
Kendrick’s predictions extend beyond mere approval, suggesting a potential spike in Ethereum’s price to $4,000, akin to Bitcoin’s price performance prior to its ETF approval. He noted:
“If ETH prices perform similarly to how BTC prices performed in the lead-up to BTC ETF approval, ETH could trade as high as $4,000 by then.”
Ethereum ETFs
The potential for Ethereum ETFs isn’t without its nuances. Kendrick anticipates the initial approvals to focus on simple Ethereum ETFs that track the price movements of ETH. He predicted that more complex offerings, such as ETFs incorporating staking yield rewards, may emerge later, drawing on European models as a reference.
Furthermore, Kendrick comments on Ethereum’s impending network upgrades, like Dencun or Proto-Danksharding, viewing them as beneficial for price growth. These upgrades will enhance the Ethereum ecosystem’s value retention by reducing Layer 2 fees and maintaining higher staking rewards.
Kendrick also maintained a positive view of the broader cryptocurrency market, including Bitcoin. His earlier projections anticipated a surge in the flagship cryptocurrency’s price to $100,000 by year-end and a staggering $200,000 by the close of 2025, driven by inflows into spot Bitcoin ETFs.
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