Standard Chartered, an international bank, is reportedly eyeing the potential approval of a spot Ethereum (ETH) exchange-traded fund (ETF) in the United States. The anticipation centers around the ETF applications submitted by asset managers VanEck and Ark 21Shares, with the U.S. Securities and Exchange Commission (SEC) expected to make a decision on May 23rd. Drawing parallels with the SEC’s earlier approval of 11 spot Bitcoin ETFs in January, Standard Chartered’s head of digital assets research, Geoff Kendrick, emphasizes the legal and financial similarities between Ethereum and Bitcoin, signaling a potential approval for the spot Ethereum ETF.
Kendrick further adds that Ethereum’s price trajectory could follow Bitcoin’s trading pattern during the ETF approval process, possibly leading to an increase to $4,000 by the decision date. However, Standard Chartered predicts that Ethereum may experience comparatively fewer selloffs than Bitcoin following ETF approval. This projection is based on the observation that Grayscale’s Ethereum Trust holds only a small percentage of ETH’s total market capitalization when compared to the significant amount of Bitcoin held in Grayscale’s Bitcoin Trust (GBTC).
The bank’s analysis suggests that Ethereum’s unique market dynamics may contribute to a different post-ETF approval scenario, potentially mitigating some of the sell-offs that were witnessed in the Bitcoin market. As the crypto industry closely watches regulatory developments, the decision on the spot Ethereum ETF is poised to be a significant development that could impact the broader cryptocurrency market. Investors are eagerly awaiting the SEC’s ruling, which could open new avenues for Ethereum-based financial products in the U.S. and potentially influence the digital asset’s market dynamics.
