Forum Home | Log in | Signup | My Page | Rules | FAQ | Boards | Members | Search
« 6TH POPE Home | Email msg. | Reply to msg. | Post new | Board info. Previous | Home | Next

Ether rallies 23% as SEC reevaluates ETH ETF approval after Trump goes pro-crypto 

By: De_Composed in 6TH POPE | Recommend this post (1)
Tue, 21 May 24 6:19 PM | 17 view(s)
Boardmark this board | 6th Edition Pope Board 		Msg. 53358 of 60008
Jump:
Jump to board:
Jump to msg. #

A good day! After 29 months, my Ethereum purchases from December 2021 are finally slightly black. At one point they were down 75 percent.

May 21, 2024

Ether rallies 23% as SEC reevaluates ETH ETF approval after Trump goes pro-crypto

by Jordan Finneseth
Kitco.com




(Kitco News) – Cryptocurrency prices surged over the past 24 hours amid an about-face from the U.S. Securities and Exchange Commission (SEC), which is now reportedly considering approving multiple spot Ethereum (ETH) exchange-traded funds (ETFs) after months of doubts and delays.

Over the past several months, analysts had come to a consensus that the approval of a spot Ether ETF was unlikely as the SEC showed little engagement with applicants while SEC representatives repeatedly said they considered Ether to be a security.

But with U.S. election season underway and crypto becoming a trending topic – with Donald Trump warning that Democrats would attack the industry while he would welcome it with open arms – the SEC appears to be reevaluating their approach and is now scrambling to secure approval for the ETFs.

On Monday, CoinDesk reported that the SEC had asked Ether ETF applicants to update their 19b-4 filings ahead of a key deadline this week, which was the signal needed to show that the regulator was now serious about evaluating the applications.

After the story emerged, Bloomberg ETF analysts Eric Balchunas and James Seyffart updated their approval odds from 25% to 75%, with Balchunas saying the move came after “hearing chatter this afternoon that SEC could be doing a 180 on this (increasingly political issue), so now everyone scrambling (like us everyone else assumed they'd be denied).”

Amid pushback from some on the radical increase in approval odds, analyst Nic Carter came to the defense of Balchunas and Seyffart, tweeting, “How was anyone meant to predict that Trump would endorse crypto and dems would throw up a Hail Mary and pivot? That wasn’t forecastable.”

Since reports of the about-face emerged, several asset managers have updated their filings to remove any language related to Ether staking, which was the main issue in the debate about whether Ether is a security and a commodity.

Fidelity was one of the first to adjust their application, filing an S-1 update early on Tuesday showing they have rolled back plans to stake ether holdings in their proposed spot ETF. In previous filings, the firm said it intended to “stake a portion of the trust’s assets” to “one or more” infrastructure providers, but in the update, the firm clearly states that it would “not stake the ether” stored with the custodian.

Alex Thorn, Head of Research at GalaxyDial Research, said the SEC is trying “to thread a needle between ‘ETH’ NOT being a security and ‘staked ETH’ (or even more flimsily, ‘staking as a service ETH’) as BEING a security.”

“That would be somewhat congruent with their various court cases, as well as with reports about their various investigations, and perhaps allow SEC to approve Ethereum ETFs while maintaining their previously stated/arguing opinions,” he added. “In this case and perhaps for other reasons, you would expect SEC to prohibit the ETFs from staking the ETH they hold.”

There are now nine pending Ether ETF applications with the SEC, with the filings from VanEck and ARK up for their final review on May 23 and May 24, respectively.

According to Joseph Edwards, head of research at Enigma Securities, the decision by the SEC to take a hard line stance against Ether ETFs after approving the spot Bitcoin (BTC) ETFs seemed out of step with the way things are normally done. "Opposing the ETH ETF after the BTC one was approved always seemed like an odd case for the SEC to try to push, unless they were willing to open up questions on Ethereum's securities status more broadly, and it's likely that the call has come in somewhere to not take that fight," Edwards told Reuters.

Geoff Kendrick, head of FX and digital assets research at Standard Chartered, told Forbes India that they are “80% to 90%” certain that the SEC will approve spot Ether ETFs later this week. He added that the bank anticipates first-year inflows into spot Ether ETFs to be between 2.39 and 9.15 million Ether or about $15 billion to $45 billion.

They also believe that any bad news is already priced in for both Bitcoin and Ether and "positive structural drivers" are expected to take over again, which prompted Kendrick to reiterate the bank's end-of-year price targets of $150,000 for Bitcoin and $8,000 for Ether.

But according to Seyffart, while the approval of the 19-4b applications could come on May 23, “We also need S-1 approvals. It could be weeks to months before we see S-1 approvals and thus a live ETH ETF. That said, if we're correct and we see these theoretical approvals later this week. It *should* mean that S-1 approvals are a matter of 'When' not 'If'...”

The sudden spike in approval odds provided a shot of adrenaline to Ether’s price, which surged from $3,115 on Monday to a high of $3,837 in early trading on Tuesday, an increase of 23.1%.




ETH/USD Chart by TradingView

At the time of writing, Ether trades at $3,785, an increase of 22.2% on the 24-hour chart, while Bitcoin trades at $70,215, an increase of 4.95%.

http://www.kitco.com/news/article/2024-05-21/ether-rallies-23-sec-reevaluates-eth-etf-approval-after-trump-goes-pro

» You can also:
« 6TH POPE Home | Email msg. | Reply to msg. | Post new | Board info. Previous | Home | Next