News
Ethereum Jumps 18% After Shocking ETF Announcement
10.30am ▪ 4 minute read ▪ by Luc Jose A.
The recent announcement by the United States Securities and Exchange Commission (SEC) regarding the possible approval of a spot ETF on Ethereum has triggered a real increase in Ether prices. This news, which could mark a decisive turning point for Ethereum, has sparked enormous interest from investors and pushed Ethereum to new heights. But this is understandable, considering what is at stake: a spot ETF would allow Ether to be traded on traditional markets, thus paving the way for wider adoption and potentially significant revaluation.
Ethereum rises 18% after ETF news
Like Bitcoin, Ethereum (ETH) recorded a spectacular 14% increase in value, reaching $3,540 in just a few hours. This increase came after a series of tweets from influential figures in the financial analysis industry. Eric Balchunas, senior ETF analyst at Bloomberg, announced an increase in the odds of the SEC approving an Ethereum spot ETF, bringing this estimate from 25% to 75%. This optimistic update followed a tweet from Nate Geraci, president of ETF Store, highlighting the growing optimism surrounding this approval.
According to Balchunas and his colleague James Seyffart, the SEC may reconsider its position on this increasingly politicized issue. They noted that the general expectation was more of a rejection of requests for spot Ethereum ETFs. Geraci explained that the SEC approval process for Ethereum spot ETFs involves two phases: approval of changes to exchange rules 19b-4 and approval of S-1 registration statements. While the SEC could approve the changes to Rule 19b-4, it could delay approval of the S-1s, potentially postponing the ETF’s actual launch.
The market responded sharply to this announcement, leading to a rise in not only the price of Ethereum but also Bitcoin (BTC), which increased by 6%, and other cryptocurrencies recorded similarly spectacular gains. Additionally, QCP Capital shared unconfirmed information that the SEC may have asked cryptocurrency exchanges to update their 19b-4 filings as soon as possible. This move could signal an imminent Ethereum ETF approval, although this decision remains uncertain and far from 100% guaranteed.
If the spot ETF is approved…
The approval of an Ethereum spot ETF would have major implications for the cryptocurrency market. This decision would allow investors to buy and sell Ethereum shares on traditional exchanges, thus increasing the cryptocurrency’s accessibility and legitimacy. Such approval could stimulate demand and lead to a significant increase in the value of Ethereum.
The recent activities of Ethereum whales, which purchased more than 110,000 ETH in 24 hours, show strong confidence in the future of the cryptocurrency. This massive accumulation suggests that institutional investors anticipate a future price increase related to ETF approval. Furthermore, the increase in transaction volume, which increased by 185%, indicates renewed interest and increased liquidity in the market.
Likewise, if the SEC were to approve the ETF, it could set a favorable precedent for other cryptocurrencies and encourage them wider adoption of cryptocurrency ETFs.
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Luc Jose A.
Graduated in Science Po Tolosa and holder of a blockchain certification consultant issued by Alyra, I returned to participate in Cointribune in 2019. Capturing the potential of blockchain to transform numerous sectors of the economy, I have made a commitment to raise awareness and inform the great public about this constantly evolving ecosystem. My goal is to allow anyone to better understand blockchain and learn about the opportunities it offers. I strive every day to provide an objective analysis of current events, to decipher market trends, to convey the latest technological innovations and to put into perspective the economic and social efforts of this revolution in brands.
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be relied upon as investment advice. Do your research before making any investment decisions.