How many people were awakened by the rise of ETH?

Bloomberg's ETF analyst Eric Balchunas unexpectedly raised the probability of spot ETH ETF approval from 25% to 75%. He said that he heard some rumors this afternoon that the SEC might make a 180-degree turn on this issue (this issue is becoming more and more political), so everyone is now desperately preparing.

Subsequently, Coindesk published an article stating that three people familiar with the matter said that the U.S. Securities and Exchange Commission asked ETF exchanges to speed up the update of 19b-4 applications, indicating that it may approve these 19b-4 applications before the key deadline (May 23/24).

Of course, this does not mean the ETF will be approved, the issuer will also need its S-1 filing approved before the product can begin trading.

It is reported that a 19b-4 application refers to an application submitted pursuant to Section 19(b) and Section 4 of the Securities Exchange Act. Such an application is usually submitted by a stock exchange or other self-regulatory organization (SRO) to the U.S. Securities and Exchange Commission (SEC) to obtain approval for changes to its rules. These changes may involve the exchange's operating rules, listing standards, fee structure, etc. The SEC will review these applications to ensure that they meet the fairness and efficiency requirements of the securities market.

19b-4 is the precursor to applying for approval of an Ethereum spot ETF.

Why did the SEC suddenly make a 180-degree turn?

Perhaps, as analyst Eric Balchunas suggests, American politics is the main factor.

Last Wednesday, Coinbase said in a research report that Ethereum (ETH) has the potential to bring unexpected gains. The market may underestimate the timing and possibility of the approval of the US spot Ethereum ETF.

HAN, the author of the report, said that if the SEC rejects the spot ETH ETF, it will consume the capital of the US Democratic Party, which is not a good strategy in an election year.

Currently, SEC Chairman Gensler and two other voting members are Democrats, and the other two voting members are Republicans. The entire SEC senior management is still dominated by Democrats.

Previously, Trump extended an olive branch to cryptocurrency and shouted slogans, saying that if you support cryptocurrency, you should vote for Trump. If Biden's Democratic government continues to maintain a tough anti-crypto stance, it may be detrimental to its election prospects.

Another major event that deserves special attention is the abolition of SAB 121.

On May 17, the Senate passed H.J.Res 109, which overturned SEC Staff Accounting Bulletin No. 121 (SAB121). Notably, the bill passed by a vote of 60 to 38, indicating that a majority of both parties supported the bill.

SAB121 was released in 2022. It requires digital asset custodians to treat digital assets as liabilities and hold them at fair value on their balance sheets. If a bank custody $1 billion of Bitcoin for a client, they must hold $1 billion in cash to offset this “liability” on their balance sheet.

This prevents financial firms from taking custody of Bitcoin and other cryptocurrencies.

However, a statement released by the White House previously emphasized that if the bill (H.J.Res 109) reaches President Biden's desk, he will veto it. Biden can choose to sign, veto, or do nothing. If he chooses to do nothing, the bill will take effect without his signature.

If Biden ultimately chooses to sign or do nothing, this may truly represent a complete shift in the Democratic Biden administration's attitude toward the cryptocurrency field.

The SEC faces May 23 and May 24 deadlines to make decisions on VanEck and ARK’s Ethereum ETF applications, respectively.

Another time point that deserves most attention is August. August 3 is the deadline for Fidelity's Ethereum ETF, and August 7 is the deadline for BlackRock's Ethereum ETF.

We may not see the dawn of victory in May, but we may see it in August.