Ether Hits $3,000 Amid Speculation of Spot Ether ETF Approval
Ether’s price surged to $3,000 on Tuesday, marking its highest level in almost two years. This increase comes as speculation grows about the potential approval of spot ether exchange-traded funds (ETFs) in the U.S., possibly as early as May.
The second-largest cryptocurrency by market cap reached a peak of $3,003.40 before experiencing a slight pullback. Currently, ether is trading at $2,931, showing a 1% increase in the past 24 hours, a 14% increase over the past week, and a 30% increase year-to-date.
Bitcoin also achieved a new yearly high of $52,908 today, with an 8% gain over the past week amidst a broader rally in the crypto market.
Spot Ether ETF: The Next Big Thing?
After the successful launch of spot bitcoin ETFs in January, attention has turned to the possibility of a spot ether ETF in the U.S. Several prominent firms such as Fidelity, BlackRock, and Franklin Templeton have applied for spot ether ETFs in recent months.
There is growing speculation about the approval of these products this year. Bloomberg ETF analyst Eric Balchunas suggests there is a 70% chance of approval by May 23, which is the final deadline for the Securities and Exchange Commission (SEC) to rule on Ark and 21Shares’ spot ether ETF application—the first one filed.
Standard Chartered also predicts a potential target price of $4,000 for ether if it follows bitcoin’s performance before spot ETF approval. However, TD Cowen believes the SEC is unlikely to approve spot ether ETFs anytime soon, while JPMorgan puts the chances of approval by May at less than 50%.
Uncertainties Surrounding Spot Ether ETF Approvals
There are uncertainties surrounding the approval of spot ether ETFs, given SEC Chair Gary Gensler’s stance that cryptocurrencies other than bitcoin are securities. However, Gensler’s predecessor, Jay Clayton, mentioned that a small number of tokens may no longer be considered securities if they become widely decentralized. Former SEC Director of Corporate Finance William Hinman also stated in 2018 that ether, considering its decentralized nature, is not a security.
As the crypto market eagerly awaits the SEC’s decision on spot ether ETFs, the potential approval could have a significant impact on the price and adoption of ether.
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