There’s a feeling of anticipation in the cryptocurrency market right now as U.S regulators weigh in on whether to approve Ethereum exchange-traded funds (ETF), a decision that is expected later today.
Ahead of the decision, BlackRock and five other issuers filed updates to their ether ETF proposals with the U.S. Securities and Exchange Commission. All updated proposals removed staking, a process that lets investors earn an income by locking up their crypto for a set period of time to support the operation of a blockchain.
Despite the optimism in the air, crypto nemesis and head of the Securities and Exchange Commission Gary Gensler reasserted his belief today that most cryptocurrencies are securities. When asked about the SEC’s ability to regulate crypto, Gensler said that, “Not every crypto token is a security…but I believe, again without prejudging, most are.”
Earlier in the week, Gensler argued that the Financial Innovation and Technology for the 21st Century ACT, F1T21— the first major crypto bill to be passed by the U.S. House of Representatives — would remove crypto from SEC oversight by undermining the classification of cryptocurrencies as investment contracts. The White House also publicly opposed the new act. Nevertheless, the U.S. House of Representatives approved the new legislation on Wednesday by a vote of 279 to 136. The bill, which provides a legal framework for trading digital assets, must now go to the U.S. Senate.
But what’s on everyone’s mind today is the potential approval of Ethereum spot ETFs, a development that would likely lead to a surge in the token’s price. Many analysts in the space are optimistic it’s going to happen.
According to the founder and CEO of MNTrading firm, Michael van de Poppe, “Everything is in anticipation of a potential Ethereum ETF to be approved.” Another trading firm, QCP Capital, added that it believes “an approval is now highly likely with trading expected as early as next week.”
The U.S. Seeks Crypto Clarity as Election Approaches
As the U.S. prepares itself for a presidential election in November, it appears lawmakers are wising up to the importance of clear cryptocurrency regulation for American voters. That could manifest itself with the approval of the spot Ethereum ETFs later today, which before this week, most people in the space were not expecting.
For now, the potential approval for the spot Ethereum ETF has turned the market green. At the time of writing, Ethereum was up to $3,800, up around 28% over the past seven days. Bitcoin was hovering around $67,800 and looks poised for another breakout. If the Ethereum ETFs are approved, it will likely lead to a rise in the token’s value and possibility a bullish run in the market at large. After the Bitcoin ETF was approved on January 11th, Bitcoin rose from $42,000 to $73,000 in only two weeks.
As we approach the decision, buying activity for Ethereum has increased across all marketplaces this week, according to the on-chain analytics firm CryptoQuant. On Tuesday, holders bought over 100,000 ETH in spot markets, the highest daily numbers recorded since September 2023.
Furthermore, if the spot ether ETFs are approved today, Ethereum would become the first non-Bitcoin blockchain asset to be classified as a commodity. This is raising hopes that other crypto, particularly Solana, could follow in its footsteps.
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