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Standard Chartered Predicts U.S. Approval of Ether ETFs by May, Foresees Price Surge

2024.01.31

 

Key Takeaways

  • Standard Chartered Bank projects a nearly 70% rise in Ether’s value by May, aligning with potential U.S. SEC approval for Ether ETFs.
  • The bank anticipates Ether’s market performance to parallel or exceed Bitcoin’s prior ETF approval surge.

Ether’s Bullish Forecast

Standard Chartered Bank, in a recent report, anticipates a significant surge in Ether (ETH) prices, potentially reaching $4,000 by May. The bank’s research team, led by Geoff Kendrick, bases this forecast on the expected U.S. Securities and Exchange Commission (SEC) approval of spot-based Ether exchange-traded funds (ETFs).

Anticipated SEC Approval Timeline

The StanChart analysts predict a similar trajectory for Ether ETFs as witnessed with Bitcoin, foreseeing the SEC delaying decisions on spot ETF applications before eventually approving them. The final deadlines for applications by asset managers VanEck and Ark/21Shares, set for May 23, are seen as the pivotal dates for potential approval.

Market Underestimation and SEC Stance

The report suggests that the market currently underestimates the likelihood of Ether ETF approval. Standard Chartered sees “no fundamental reason” for the SEC to differentiate ETH from Bitcoin in its treatment, especially considering that Ether futures are listed on the regulated Chicago Mercantile Exchange (CME). Additionally, the SEC’s exclusion of ETH from the list of cryptocurrencies it deems securities in the Ripple case is noted as a positive indicator.

Ether vs. Bitcoin: Post-ETF Approval Scenario

The report forecasts that Ether may experience less selling pressure post-ETF approval compared to Bitcoin. This is attributed to the smaller market share of the Grayscale Ethereum Fund (ETHE) relative to the total Ether market capitalization, and the minimal impact of the FTX bankruptcy estate on ETHE, unlike the Grayscale Bitcoin Fund (GBTC).

Bitcoin’s ETF Approval Impact and Ether’s Potential Path

Drawing parallels with Bitcoin’s market behavior, which saw an 85% surge from June to January following BlackRock’s ETF filing and subsequent approval, Standard Chartered anticipates Ether to either track or outperform this trajectory. The report also clarifies that the initial Ether ETFs in the U.S. are likely to track the spot price of ETH without incorporating staking rewards.

 


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