JPMorgan: Chances of spot Ethereum ETF approval less than 50%
JPMorgan: Chances of spot Ethereum ETF approval less than 50%
After the US Securities and Exchange Commission (SEC) was forced to approve spot Bitcoin ETFs, their launch has attracted billions of dollars. However, analysts at JPMorgan see long debates and discussions ahead before spot Ethereum ETFs are approved.
The bank said that SEC lawsuits against cryptocurrency companies that provide staking services for blockchains, including Ethereum, are delaying the approval of ETH ETFs, and they are unlikely to launch before May, according to Coindesk.
"SEC lawsuits against cryptocurrency exchanges are complicating the approval of spot Ethereum ETFs, at least until those lawsuits are resolved," JPM said in the report.
The resulting optimism in the crypto community has sparked rumors of the possible approval of an Ether ETF by May 23, 2024. This is the date set by the Securities and Exchange Commission (SEC) as the deadline for Ark 21Shares' application.
However, there is less than a 50% chance that the SEC will approve an Ethereum ETF by May. Markets expect Ether to legitimately become the next contender to launch an ETF in the US. This is supported by the declining net asset value (NAV) of the Grayscale Ethereum Trust (ETHE), which has been falling since the summer.
In favor of the approval of spot ETH ETFs is the fact that the SEC does not mention ETH in lawsuits against crypto companies, perhaps recognizing the crypto asset as a commodity, which is a prerequisite for spot ETF approval.
Nikolaus Panigirtzoglou of JPMorgan assessed the possible approval of the ETH ETF: "We consider all arguments but are skeptical that the SEC will classify Ether as a commodity as early as May." He believes that the probability of the SEC approving spot Ethereum ETFs by May is no more than 50%.
Although it's worth noting that since the approval of the spot Bitcoin ETF, the value of ETH has jumped as traders bet on the approval of the Ethereum ETF. In this way, investors could more easily access ETH and invest in it without owning the crypto directly.
Further reading: Hong Kong firm ready to launch Bitcoin ETF
