The recent surge in the price of Ether, the second-largest cryptocurrency by market capitalization, comes as the U.S. Securities and Exchange Commission (SEC) is set to announce its decision on spot exchange-traded fund (ETF) applications for Ether. This surge is fueled by speculation that the SEC might approve these applications, contrary to what investors had initially anticipated. This speculation has resulted in an 8% increase in the price of Ether, reaching $3,775, its highest level in two months, following a 13.8% jump on Tuesday.
In addition to Ether’s rally, Bitcoin has also seen an increase, approaching its all-time high. Bitcoin is currently trading at $71,000, just 4% below its peak of $73,803.25 in March. The approval of spot Bitcoin ETFs earlier in the year by the SEC has led to a significant increase in Bitcoin’s price and inflows of billions of dollars. This year alone, Bitcoin has gained 67%, closely followed by Ether with a 60% increase.
As the SEC prepares to make a decision on spot Ether ETF applications, various issuers, including VanEck and ARK Investment Management, are awaiting approval. The SEC is expected to rule on VanEck’s and ARK’s filings by May 23 and May 24, respectively. Reports suggest that the SEC has asked exchanges to update their filings related to the Ether ETF and analysts have raised the probability of approval. Despite the uncertainty surrounding the approval, market analysts remain optimistic about the potential impact of an ETF approval on the crypto markets.
The recent surge in crypto markets can also be attributed to the broader market sentiment. Last week, data indicating a slowdown in U.S. inflation resulted in a rally in risk assets, including cryptocurrencies. The positive market sentiment, combined with the anticipation of ETF approvals, has contributed to the upward trend in Ether and Bitcoin prices. While the outright approval of Ether ETFs may be unlikely, any guidance from the SEC on a potential pathway to approval could have a significant impact on the future of cryptocurrencies.
The speculation surrounding the approval of ETFs for Ether and Bitcoin has fueled a surge in crypto markets, with investors closely watching the SEC’s upcoming decisions. The potential approval of Ether ETFs could mark a significant milestone for the crypto industry, further legitimizing cryptocurrencies as mainstream investment assets.