The Zhitong Finance App learned that as investors became optimistic about the application results for the Ethereum Spot Exchange Traded Fund (ETF), Ethereum rose another 8% to $3,775 on Tuesday after rising 13.8% on Monday, the highest level in two months.
US regulators will decide on some Ethereum spot ETF applications this week. Analysts and investors said that Ethereum's sharp rise on Tuesday was due to unconfirmed rumors that the US Securities and Exchange Commission (SEC) might approve these products.
Earlier this year, after the SEC approved a number of Bitcoin spot ETFs, Bitcoin rose sharply, and these ETFs also received billions of dollars in capital inflows. Bitcoin has risen 67% so far in 2024. Ethereum has risen 60% since this year.
Ben Laidler, a global market strategist at eToro, said: “Ethereum took the lead in the latest cryptocurrency rally ahead of Thursday's SEC decision on an Ethereum spot ETF.” “It's very unlikely that an Ethereum spot ETF will be fully approved, but any guidance on the path to final approval would be a big step forward.”
According to reports, VanEck, ARK Investment Management, and seven other issuers have submitted applications to the SEC to list an Ethereum spot ETF. The SEC must decide on Vaneck's and ARK's applications by May 23 and May 24, respectively.
According to the media quoting several people familiar with the matter, the SEC has requested NASDAQ, the Chicago Options Exchange, and the New York Stock Exchange to adjust their Ethereum ETF listing applications on Monday, which indicates that the SEC may be ready to approve these applications. The latest development is that SEC officials require the above exchanges to submit applications by Tuesday at the latest.
According to reports, the SEC asked an Ethereum ETF issuer to update its 19b-4 filing on Monday. Form 19b-4 is commonly used to notify the SEC about rule changes that allow funds to trade on exchanges. ETF issuers are required to obtain approval from Form 19b-4 and an S-1 registration statement before they can officially launch the product. ETF analyst Eric Balchunas said that the probability of approval for spot Ethereum ETFs is expected to rise from 25% to 75%.
Some analysts say that if an Ethereum ETF is approved, it may cause market demand to soar, leading to tight supply and push up the price of Ethereum. Joe Lubin, co-founder of Ethereum and founder of crypto infrastructure company Consensys, said that institutions that have obtained exposure to Bitcoin through newly launched Bitcoin ETFs “probably want to invest in the second approved cryptocurrency ETF in a diversified manner.”
In addition, there are also analytical opinions that the launch of an Ethereum ETF may have a negative impact on spot Bitcoin ETFs and Bitcoin itself, and that market capital will shift from Bitcoin ETFs to Ethereum ETFs.