Yesterday, at 9.00 pm, the price of ETH soared registering an hourly candle of +9.2% following the news leaked on X regarding an approval by the SEC of Ethereum spot ETFs on Wall Street by Wednesday.
According to reports from Bloomberg and Coindesk, the chances of an imminent introduction of this investment product on US exchanges have suddenly increased from 25% to 75%, fueling wild speculation on the cryptocurrency.
Now ETH has continued its bullish run up to 3,700 USD and could soon pay another visit to the 4,000 USD area: volatility coming in the next few days.
Everything you need to know below.
The chances of SEC approval for the ETF ETH are increasing
Until a few hours ago it seemed like just a mirage, now instead the chances of seeing the Ethereum spot ETF approved on Wall Street have increased dramatically after the latest breaking news arrived on X yesterday evening.
As publicly reported by Eric Balchunas, senior ETF analyst at Bloomberg, suddenly the Securities and Exchange Commission seems to be strongly inclined to definitively approve both form 19b-4s and the S-1s registration statement for the requests of several investment funds in relation to the fillings submitted in recent months to the US market watchdog.
As confirmed also by colleague James Seyffart, and by ETFStore president Nate Geraci, at the center of this change in perspective by the federal agency there seem to be political motivations, with President Biden who seems to want to appear more crypto-friendly in view of the US presidential elections in November.
Suddenly the odds of approval for the Ethereum spot ETF by the May 23 deadline have jumped from a mere 25% to 75% (Bloomberg Odds).
Update: @JSeyff and I are increasing our odds of spot Ether ETF approval to 75% (up from 25%), 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). See… https://t.co/gcxgYHz3om
— Eric Balchunas (@EricBalchunas) May 20, 2024
Just an hour after the news spread by Balchunas, the information portal Coindesk published an article reporting some rumors from 3 different sources close to the SEC, according to which Gary Gensler and company would be asking requesting funds to quickly update the 19b-4 documents by Wednesday.
This in itself does not necessarily imply approval by the deadline date, considering that in addition to 19b-4 the SEC must carefully review the S-1 documents, and it may take longer than expected before giving a final response.
Coindesk also reports that a company in negotiations with the federal entity believes that the market is on track for an imminent approval, and that ETH will not be considered as security.
Via @coindesk fyi https://t.co/2PNBCkr90q pic.twitter.com/ElI4rIp8Ho
— Eric Balchunas (@EricBalchunas) May 20, 2024
The soap opera of crypto ETFs continues, started at the beginning of the year after the fake news emerged about a supposed approval of Bitcoin exchange-traded funds, then denied by the SEC and finally confirmed a couple of weeks later.
In this case, given the reliability of the sources, we exclude the hypothesis fake news but remain on alert until the actual communication from the SEC.
We do not exclude a postponement, precisely for the reasons mentioned above regarding the S-1 document theme, and consequently a negative market reaction, with the price of ETH that could be strongly affected downwards.
All eyes are on the next two days, especially on the date of Thursday, March 23, deadline for the request of the ETF by Vaneck, even if as Bloomberg analysts affirm, the official announcement could arrive as early as Wednesday.
Ethereum price rises by 20% in one day thanks to the news on ETFs: local peak coming
Following the news on the ETF ETH, with the chances of approval drastically increasing from one moment to the next, the price of Ethereum has increased sharply in just a few hours.
From 9:00 pm yesterday until now, ETH has grown by 17.81% going from 3,150 USD to the current 3,714 USD.
In the last 24 hours, the price evolution has an impact of 20%, with volumes exploding by +255%: we are talking about one of the most extreme pumps in the last years in the history of Ethereum.
As user X “bx1core” points out, in less than a day about 70 billion dollars of market capitalization have been added, almost as much as the entire market value of Solana.
This highlights how investors are bullish on the second largest cryptocurrency in the sector, and how their short-term sentiment depends on decisions regarding the approval or rejection of the spot ETF.
Indeed, the news of an approval could bring, as happened analogously with Bitcoin, a strong inflow of institutional capital with consequent increase in the price of the underlying asset.
$ETH literally added Solana’s entire marketcap in one single candle
Sit down the king is home pic.twitter.com/eDziukrHw1
— bx1 (@bx1core) May 21, 2024
In a blink of an eye, the market outlook of Ethereum changes completely: with the latest rally, the chances of a breakout of the local high at 4,090 USD also increase in the coming days and of a subsequent breakout of the historical high set at 4,860 USD.
If the ETF is approved definitively, we could celebrate an event that will be remembered for a long time, whose effects will be visible even in the next 10 years.
Now, however, maximum attention to short-term manipulations: those who know the crypto market well know that these are tempting opportunities to generate extreme volatility, perfect for making stellar gains or printing solemn losses.
DO NOT BETRAY the EVENT: despite the news emerged, betting on the rise or fall at the same time as the deadline date is like flipping a coin.
Instead if the goal is to accumulate ETH, a winning strategy could be to place a buy order in the price range from $3,200 to $2,900.
Open eyes and eye on market volatility: stay safe traders!
Grafico di $eth se l'ETF non viene approvata pic.twitter.com/oK7MqyBqBW
— Marco Gallazzi (@ChartMind) May 21, 2024
