JPMorgan Cautious about Approval of Ethereum ETFs
The Securities and Exchange Commission (SEC) has set May as the deadline for the approval of Ethereum-linked exchange-traded funds (ETFs), but JPMorgan remains cautious. According to Nikolaos Panigirtzoglou of JPMorgan, in order for the SEC to approve spot Ethereum ETFs by May, it should consider Ethereum as a commodity rather than a security. However, Panigirtzoglou believes there is less than a 50% probability that the SEC will classify Ethereum as a commodity by May. JPMorgan’s caution is due to the fact that the SEC has not changed its stance on classifying cryptocurrencies other than Bitcoin as securities.
Traders Optimistic about Spot ETF for Ethereum
According to analysis company IntoTheBlock, traders are already operating under the belief that Ethereum will be the next cryptocurrency asset to obtain an ETF in the spot market. Lucas Outumuro from IntoTheBlock states that Ethereum has significantly outperformed Bitcoin in recent days following the false approval of spot-based BTC ETFs. The rapid rise of Ethereum is seen as a signal that traders are anticipating the approval of Ethereum ETF requests in the spot market. Outumuro believes that the approval of spot Bitcoin ETFs paves the way for a spot Ethereum ETF.
Potential Catalyst for Ethereum
Traders are accumulating cryptographic assets to support the ETH ecosystem and are favoring investments related to ETH with higher beta, such as layer-2 tokens and liquid staking protocols. This week, these investments have recorded gains of over 10%. Traders see the potential approval of ETH ETFs as the next major catalyst for Ethereum.
Hot Take: Uncertain Future for Ethereum ETF Approval
The approval of Ethereum spot ETFs by May is uncertain, according to JPMorgan. The SEC would need to classify Ethereum as a commodity rather than a security, and JPMorgan believes there is less than a 50% probability of this happening. Despite the recent approval of Bitcoin spot ETFs, the SEC has not changed its stance on classifying cryptocurrencies other than Bitcoin as securities. However, traders are optimistic about the approval of spot ETFs for Ethereum, as the cryptocurrency has outperformed Bitcoin and there is anticipation in the market. The potential approval of ETH ETFs could be a major catalyst for Ethereum.
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