Ethereum could soon rocket upwards following the Securities and Exchange Commission’s bombshell move to approve spot Ethereum exchange-traded funds (ETFs) last week, market analysts say.
After months of terse delays and limited engagement, Wall Street’s top regulator gave the green light to a long list of asset managers that had applied to offer an Ethereum ETF.
Industry observers now foresee the second-biggest digital coin to shoot up even more in value.
Ethereum ETFs Approved: A New Era for Crypto Investments
SEC Approves Ethereum ETFs
The Securities and Exchange Commission (SEC) has made a landmark decision by approving spot Ethereum exchange-traded funds (ETFs). This move comes after months of delays and limited engagement from Wall Street’s top regulator. The approval allows a long list of asset managers to offer Ethereum ETFs, which is expected to significantly impact the market.
Market Reactions and Predictions
Industry observers are optimistic about the future of Ethereum. Despite some anticipated downward pressure on the price of ETH due to outflows from the nearly five-year-old Grayscale Ethereum Trust (ETHE), data firm Kaiko predicts that the asset’s value will rise over the long term. Kaiko’s analysis is based on the performance of Bitcoin ETFs following their approval, which initially saw a dip but eventually led to substantial gains.
Short-Term vs. Long-Term Impact
Kaiko noted that once the ETH ETFs launch, there might be selling pressure on ETH due to likely outflows or redemptions from Grayscale’s ETHE, which has been trading at a discount between 6% and 26% over the past three months. However, the firm emphasized that the approval removes some of the regulatory uncertainty that has weighed on ETH’s performance over the past year, providing a more favorable long-term outlook.
Expert Opinions
Greg Magadini, Derivatives director at blockchain data provider Amberdata, believes that the approval news has already triggered a bull run for Ethereum, even though the actual ETFs have yet to start trading. JPMorgan, America’s biggest bank, expects the funds to start trading before November, which could further boost Ethereum’s market value.
Investor Opportunities
When Ethereum ETFs hit the market, they will offer investors exposure to ETH via shares that trade on a stock exchange. This development is expected to attract a new wave of investors who prefer traditional financial instruments over direct cryptocurrency investments.
Conclusion
The approval of Ethereum ETFs by the SEC marks a significant milestone for the cryptocurrency market. While there may be short-term volatility, the long-term outlook for Ethereum appears promising. Investors and industry experts alike are optimistic that this move will pave the way for greater adoption and higher valuations for ETH.