Ethereum posted a surprising rally on Monday, posting its biggest one-day gain in three years and surpassing industry giants such as Mastercard and LVMH in market capitalization. The surge was triggered by growing speculation about the possibility of the Securities and Exchange Commission (SEC) approving a spot Ethereum exchange-traded fund (ETF).
News of increased likelihood of SEC approval of a spot Ethereum ETF sparked buying activity for ETH, sending the price skyrocketing from under $3,100 to over $3,800 within 24 hours. The biggest surge since May 2021 reflects growing optimism among investors about a potential ETF approval.
Bloomberg ETF analyst Eric Balchunas raised the odds of approval for a spot Ether ETF to 75%, citing new discussions within the SEC. Balchunas’ post quickly gained traction, racking up nearly 5 million views and sparking speculation within the cryptocurrency community.
The unexpected news surrounding the possible approval of a spot ETH ETF has boosted Ethereum’s market capitalization to over $450 billion, making it one of the top 20 companies globally by market capitalization. Notable companies that Ethereum outperformed include Mastercard (NYSE:MA), LVMH (LVMUY), Procter & Gamble (NYSE:PG), Samsung (KRW), and Bank of America (NYSE:BOA).
However, the ETF approval process is not straightforward as it involves a variety of formalities and regulatory considerations. The SEC may approve a Form 19b-4 for a fund to list an ETF, but a decision on the detailed S-1 form may be delayed. This approach will provide additional time for regulators to evaluate individual applications and understand the implications of the ETF launch.
Despite the potential for regulatory complexity, many cryptocurrency enthusiasts remain optimistic about Ethereum’s prospects, predicting the price to surpass $4,000 upon approval of a spot ETF, and even surpass its all-time high of $4,900. Similar to Bitcoin’s price trajectory following ETF approval, Ethereum could experience significant upward momentum.
As the cryptocurrency market awaits further developments, the potential approval of a spot ETH ETF could fuel Ethereum’s continued growth and market dominance in the digital asset space.
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