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According to some analysts, the SEC could approve a spot Ethereum ETF within a few days.
Today, the cryptocurrency market was marked by a significant breakthrough of Ether, which climbed 26% in just 24 hours. This bullish movement was primarily fueled by increasing hopes of an imminent approval of a cash Ethereum ETF by the Securities and Exchange Commission (SEC). The American financial market watchdog indeed asked the exchanges that plan to list the spot Ethereum ETFs to update their 19b-4 filings before the May 23 deadline. This request was perceived as a positive signal, indicating a possible change in position from the SEC, initially seen as very unfavorable to these applications. Analysts at Bloomberg thus revised their forecasts regarding the probability of this ETF's approval, moving from 25% to 75%, a announcement which sparked a renewed optimism among investors and market observers. However, although the May 23 deadline is rapidly approaching, the launch of these ETFs is not yet guaranteed. The S-1 registration statements also have to be approved for a spot Ethereum ETF to be launched, « which could take several weeks, even several months » according to Simon Peters, analyst at eToro.
This news, nonetheless, enabled Ether to go from 3000 dollars, a level it had struggled to maintain in recent weeks, to 3800 dollars within a few hours. Consequently, the liquidation of over 250 million dollars in short positions in crypto derivatives took place, according to CoinGlass, with Bitcoin and Ethereum capturing about 80 million dollars each from these liquidations, the largest since last March 6. In other words, investors who had bet on the decline of the two cryptocurrencies suddenly changed their minds and were forced to surrender their positions.According to Samer Hasn, an analyst at XS.com, the sense of optimism has also « pushed the open positions on Ethereum futures to their highest historical levels, surpassing 14 billion dollars », even though prices are still far from their 2021 historical levels.Furthermore, this positive momentum contributed to a significant increase in activity on the Ethereum network, with the total value locked (TVL) in Ethereum L1 reaching its highest level since 2022, at 63 billion dollars.However, although the chances of approval for spot Ethereum ETFs have considerably increased, uncertainty persists about the exact timeline of their launch. The next few days will be crucial in determining whether this breakthrough will translate into the realization of market expectations.Between last January and March, the approval of spot Bitcoin ETFs had triggered a market frenzy that led the cryptocurrency to its all-time high of 73,135 dollars.
