Over the past 24 hours, Ethereum (ETH -2.03%) surged more than 25%, rising from just $3,000 to more than $3,700 at one point.
This bullish momentum is primarily driven by growing anticipation surrounding the potential approval of a spot Ethereum exchange-traded fund (ETF), a development that could have profound implications for the broader cryptocurrency market.
Analysts who have been closely watching the agency evaluate a slew of applications to launch an ETF that tracks ethereum, the second largest cryptocurrency behind bitcoin, just became way more optimistic that the SEC will approve the investment vehicles.
Bloomberg analysts shifted their odds of approval from 25% to 75% on Monday.
The price of ethereum shot up 22% Monday on the news, boosting bitcoin along with it. Ethereum has gained 106% in the past 12 months as crypto’s winter has thawed, while bitcoin is up 159% over the past year.
Eric Balchunas, Senior ETF analyst at Bloomberg Intelligence, explained to Brew Markets that their team changed their odds after hearing the SEC was communicating with exchanges about launching the funds. “This is the 11th hour, you can’t get any more late in the game than this,” Balchunas said of the reversal. “This feels like a 180.”
Fidelity revises the proposal of Ethereum ETF omitting the staking
Among the growing speculations about the possible approval of ETFs on Ethereum, Fidelity Investments has updated its Ether ETF proposal, removing all previously included staking features.
This update follows the news that the United States Securities and Exchange Commission (SEC) has requested ETF issuers to review their 19b-4 documents.
Fidelity: speculation on the approval of Ethereum ETFs without stalking features is growing
As anticipated, in an updated document on May 21, Fidelity has revised its proposal for an ETF on Ethereum, removing all references to the use of the underlying ether for staking.
The initial proposal from Fidelity, presented last March, included this feature. However, Fidelity was not the first to remove staking. Ark Invest had already made a similar change the previous week.
Gabor Gurbacs, strategic consultant at Vaneck, observed on X that other issuers will likely follow suit, stating:
“Fidelity has updated its S-1 registration statement for the Ethereum ETF, removing the ‘staking rewards’ from the document. Others will do the same. Why? Locked coins are a hindrance to liquid funds. It’s not about ‘rewards’, but about yield. Voting makes the underlying a security.”
It is presumed that the SEC may classify Ethereum as a cryptographic security. Some individuals have welcomed this move, believing that ETFs could otherwise exert excessive voting power on the ETH network.
