SEC Expected to Follow Similar Path for Ethereum ETF Approval, Predicts Standard Chartered Bank
In a recent report, Standard Chartered Bank’s forex and digital assets research head, Geoffrey Kendrick, anticipates a similar approval strategy by the Securities and Exchange Commission (SEC) for spot Ethereum Exchange-Traded Funds (ETFs) as observed with Bitcoin ETFs.
Kendrick suggests that after initial rejections, the SEC is likely to grant approval by the final deadline on May 23.
“We expect pending applications for ETH U.S. spot ETFs to be approved on May 23, the final deadline for the first of the ETFs under consideration,” Kendrick stated.
“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.”
Kendrick bases his prediction on several factors, including the SEC’s non-classification of ether as a security, as well as Ethereum’s listing as a regulated futures contract on the Chicago Mercantile Exchange (CME).
“Grayscale also has an ETH trust that it wants to turn into an ETF, so a denial of that application would likely lead to another appeal by Grayscale,” Kendrick noted, emphasizing the lack of fundamental reasons for the SEC to treat ETH differently from how CME does.
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Kendrick maintains an optimistic outlook on cryptocurrency price trends, stating that the anticipated approval of spot Ethereum ETFs will attract significant inflows, potentially driving the price of Ethereum to $100,000 by year-end and $200,000 by the end of 2025.
Regarding post-approval market dynamics, Kendrick believes ether is less likely to experience selling pressure compared to bitcoin.
He attributes this resilience to the smaller share of total ETH market cap held by Grayscale Ethereum Trust (ETHE) compared to Grayscale Bitcoin Trust (GBTC) pre-approval.
While Kendrick expects simple Ethereum ETFs to replicate ether price movements to be approved on May 23, he anticipates ETFs incorporating staking yield rewards to be introduced later.
In addition to market dynamics, Kendrick highlights Ethereum’s upcoming Dencun or Proto-Danksharding upgrade as a potential driver of ether price appreciation.
This upgrade is expected to enhance the competitiveness of Ethereum by reducing Layer 2 fees and maintaining staking rewards.
Overall, the crypto community remains divided on the timeline for spot Ethereum ETF approval, with both optimistic and pessimistic views prevailing among experts.