The US SEC announced yesterday morning that it has approved the 19b-4 filings for multiple Ethereum spot ETFs. This article compiles the predictions of seven market observers and cryptocurrency industry veterans regarding the post-approval outlook for the crypto market. The article is sourced from Trista Kelley and translated, organized, and written by PANews.
Table of Contents:
Digital Asset Management Company: Galaxy Digital
Ethereum Core Institution: Consensys
Asset Management Giant: Bitwise
Blockchain Infrastructure Platform: Swarm
Data Analysis Platform: Kaiko
Analysis Research Company: Bernstein
Recently, the direction of Ethereum spot ETFs has reversed, causing high attention from the market and regulatory authorities. Based on the optimism surrounding the approval of Ethereum spot ETFs by the US Securities and Exchange Commission (SEC), the price of Ethereum has significantly increased this week and is currently at $3,807.
Although the reasons behind the sudden reversal are still controversial, market observers and cryptocurrency industry veterans generally believe that regulatory approval will have varying degrees of impact on Ethereum and other cryptocurrencies. The following are the perspectives of seven industry veterans on this matter and its subsequent effects.
Digital Asset Management Company: Galaxy Digital
Mike Novogratz, CEO of Galaxy Digital, stated in an interview with CNBC that the “broad” turn of events in Washington over the past 24 hours has disrupted the game of Ethereum spot ETFs. He believes that if the change by the US Securities and Exchange Commission is driven by political motives, then “this will be a huge shift.” In addition, he mentioned that with Trump leading in the polls, the cryptocurrency super PAC has raised over $150 million to support industry-friendly candidates (particularly in swing states), highlighting the diminishing aversion of Democrats towards cryptocurrencies.
Novogratz further added:
Ethereum Core Institution: Consensys
Joseph Lubin, co-founder of Ethereum and founder of cryptocurrency infrastructure company Consensys, stated that Ethereum is expected to experience “massive demand” which could lead to supply shortages and price increases. Lubin mentioned that institutions that have been involved with Bitcoin ETFs would “likely want to diversify their investments with a second approved ETF.” He stated that “buying Ethereum via ETF will create significant natural, pent-up pressure.” He also pointed out that compared to when the spot Bitcoin ETF was approved in January, the supply to meet this demand would be reduced.
Regarding Bitcoin, authorized participants (companies representing ETFs that purchase Bitcoin contracts when new shares are created on a daily basis) can easily acquire idle Bitcoin through exchanges or over-the-counter trading. However, on-chain data shows that over 27% of Ethereum has been staked, meaning it is locked in contracts and earning returns for its owners.
Lubin stated:
Asset Management Giant: Bitwise
Matt Hougan, Chief Investment Officer of asset management giant Bitwise, wrote in a blog post this week:
However, Hougan mentioned that the catalyst for sudden optimism towards Ethereum spot ETFs was not the main reason. He stated, “Something big happened in Washington: a bipartisan group of senators and representatives passed the first-ever legislation supporting cryptocurrencies.” He referred to the bill that repealed SEC SAB 121 policy, which imposed strict rules on cryptocurrency custody. Hougan added:
Blockchain Infrastructure Platform: Swarm
Timo Lehes, co-founder of blockchain infrastructure platform Swarm, believes that once Ethereum spot ETFs are approved, “capital will flow in massively” to Ethereum.
Data Analysis Platform: Kaiko
Adam McCarthy, an analyst at data analysis platform Kaiko, stated that option traders who crowded around bullish options are now seeking higher returns, but investors should remain cautious. He said:
He recommended keeping an eye on the Grayscale Ethereum Trust (ETHE) with a value of $9 billion:
Analysis Research Company: Bernstein
According to analysts Gautam Chhugani and Mahika Sapra from analysis research company Bernstein (with total assets of $725 billion), the approval of Ethereum spot ETFs will drive Ethereum prices up by approximately 75%, reaching a high of $6,600.
They pointed out that the SEC approved a similar Bitcoin spot ETF product in January, which stimulated a roughly 75% increase in Bitcoin prices to a historic high of $73,000 three months later.
Chhugani and Sapra stated in a report this week, “We expect ETH’s price action to be similar.”
It is worth mentioning that in November 2021, Ethereum reached a historic high of $4,878. If it can truly reach $6,600, the Ethereum price will once again surpass its previous record high.
Further Reading:
What is an Ethereum Spot ETF? Differences from Futures, How to Invest, Pros and Cons, Issuance Methods… Complete Analysis