In a recent note, Anticipation builds for a potential Ethereum surge to $4,000 as Standard Chartered predicts SEC to approve Ethereum ETFs in May. Standard Chartered, the banking giant, has put forward a prediction that the U.S. Securities and Exchange Commission (SEC) is likely to approve a spot Ethereum exchange-traded fund (ETF) in May. According to the bank’s analyst, Geoff Kendrick, the approval could lead to a surge in the price of Ethereum (ETH), reaching $4,000 by the anticipated approval date.
Led by head researcher Geoff Kendrick, Standard Chartered analysts draw parallels with the regulatory approach taken by the U.S. Securities and Exchange Commission (SEC) towards Bitcoin. They anticipate that similar to Bitcoin, the SEC will initially delay decisions on spot ETF applications for Ethereum until approving the final deadline, potentially on May 23. This date coincides with the closing deadlines for applications submitted by asset managers VanEck and Ark/21Shares.
The report emphasizes the market’s underestimation of the SEC to approve Ethereum ETFs, emphasizing parallels with Bitcoin’s approval process. Notably, Ethereum futures are already listed on the regulated Chicago Mercantile Exchange (CME), and the SEC did not categorize ETH as a security among the 67 cryptocurrencies mentioned during its legal battle with Ripple.
SEC’s Potential Approval of Spot Ethereum ETFs
Similar to Bitcoin’s regulatory journey, analysts foresee the SEC to approve Ethereum ETFs, expecting a positive impact on the market. Standard Chartered’s head of crypto research and Western emerging markets FX, Geoff Kendrick, highlighted reasons supporting the expectation of SEC’s approval for spot Ethereum ETFs in May. Kendrick draws parallels between Ethereum and Bitcoin, citing that the SEC’s approach to approving spot Bitcoin ETFs in January could set the tone for Ethereum. The analyst points out that May 23 is the deadline for the SEC to approve or deny spot Ethereum ETF applications from Vaneck and Ark 21shares.
Ethereum’s Potential Price Surge
Geoff Kendrick speculates that if Ethereum follows a trajectory similar to Bitcoin during its ETF approval process, the price of ETH could hit $4,000 by the May 23 approval date. At the time of writing, Ethereum is trading at $2,370.
Kendrick’s $4,000 price target for ETH relies on key assumptions, including low general market sentiment for approval, potential inaccuracies in implied volatility, and the SEC approving multiple spot Ethereum ETF applications simultaneously, mirroring its approach with Bitcoin ETFs.
Differences in Market Reaction Compared to Bitcoin
Standard Chartered believes that Ethereum might experience a different market reaction compared to Bitcoin post-ETF approval. While Bitcoin faced a selloff after the approval, Kendrick suggests that Ethereum may avoid a significant selloff. The analyst points out that Grayscale’s existing Ethereum Trust holds a smaller portion of the total market capitalization of Ethereum compared to Bitcoin held in Grayscale Bitcoin Trust (GBTC). This difference, according to Kendrick, makes ETH less vulnerable to a post-approval selloff compared to BTC.
It’s noteworthy that Standard Chartered had previously stated this month that the price of Bitcoin could potentially reach $200,000 in 2025.
As Ethereum eyes a possible surge to $4,000 by May, excitement grows in the crypto community. Standard Chartered’s positive outlook stems from expectations of U.S. regulatory approval for Ethereum-based exchange-traded funds (ETFs). Drawing parallels with Bitcoin’s past, the report suggests Ethereum may outperform, with a reduced risk of a post-approval selloff. While these predictions offer hope, it’s essential to approach crypto investments with caution due to market unpredictability. Investors should stay informed and be mindful of potential risks, as the crypto landscape evolves.
Also Read: Binance Allies with Swiss Banks to Tackle Counterparty Risk in the Crypto Industry.
