Ethereum spot ETF is expected to be approved, ETH surges 20% overnight

Original title: "Big reversal! Spot ETF approval is possible, ETH soars 18%"

Original source: BitpushNews

The rebound in the crypto market came unexpectedly.

On Monday afternoon, Eastern Time, Bloomberg ETF analysts wrote that based on the fact that crypto investment tools are becoming an "increasingly politicized issue", the probability of the SEC approving the spot Ethereum ETF 19b-4 has increased from 25% to 75%. Several sources revealed that the SEC is asking exchanges to speed up the update of the 19b-4 application for the spot Ethereum ETF, which has swept away the pessimism in the community and brought new hope for the eventual approval of the product.

Bitcoin market data shows that after the news was released, the price of Ethereum jumped from $3,143 to an intraday high of $3,650, a new high since mid-April, and a 24-hour increase of more than 18%.

Bitcoin rebounded to the $70,000 mark for the first time since mid-April, up $4,000 from the daily low, and returned to below $70,000 as of press time, with a 24-hour increase of nearly 5%.

The altcoin market rose across the board, with all but a dozen of the top 200 tokens by market value recording gains on Monday, and only five tokens fell by more than 2%.

Pyth Network (PYTH) led the gains, up 20.4%, followed by Pendle (PENDLE) up 20.1%, Reserve Rights (RSR) up 18%, and Solana up 8% in the past 24 hours, breaking through $180. DeXe (DEXE) fell the most, down 5.4%, Chainlink (LINK) down 2.2%, and 0x Protocol (ZRX) down 2%.

Is there hope for Ethereum spot ETF approval?

“James Seyffart and I are raising the odds of a spot Ethereum ETF being approved to 75% (up from 25%), hearing rumors this afternoon that the SEC may do a 180 on this (increasingly political issues)”, Bloomberg senior ETF analyst Eric Balchunas said on X Platform on Monday.

Another Bloomberg ETF analyst, James Seyffart, also posted his comments on the social media platform. He said: "The approval of the spot Ethereum ETF is getting better this week. We have increased the chance of the spot Ethereum ETF approval to 75%. But this is the May 23 deadline for 19b-4, (Vaneck's deadline) We also need S-1 approval, and it may take us a few weeks to a few months to see the S-1 approved and see the Ethereum ETF go live."

According to a person familiar with the matter who requested anonymity, conversations between at least one potential issuer of an Ethereum spot ETF and the U.S. Securities and Exchange Commission have been making progress.

Crypto stance becomes an important issue in the U.S. election

Political pressure around cryptocurrencies appears to have emerged last Thursday as a piece of legislation supporting cryptocurrencies passed the U.S. Senate and won the approval of some of the body's leading Democrats.

The Senate voted 60-38 to approve a resolution to overturn SEC Staff Accounting Bulletin 121, which would set specific accounting standards for companies that act as cryptocurrency custodians, with several lawmakers from President Biden's party, including Senate Majority Leader Chuck Schumer, a Democrat, voting in favor of the measure.

"It looks like some of the political factors in this regard may have changed rapidly," Balchunas said, adding that cryptocurrencies in general appear to be becoming a more political issue ahead of the upcoming U.S. election. While he said he couldn't be completely sure, President Joe Biden's administration may want to appear less "tough" on crypto issues.

The U.S. SEC must decide by May 23 whether to approve or reject VanEck's spot Ethereum ETF, with ARK 21Shares, Hashdex, Invesco Galaxy, BlackRock and Fidelity also awaiting the SEC's decision.

James Seyffart said: "This is what we have heard from multiple sources, and if we are correct, we should see a bunch of documents in the next few days."

The result is unknown

VanEck CEO Jan van Eck said in an interview on April 9 that he personally doubted whether the SEC would approve his company's ETF application in May. Asset management company Grayscale withdrew its application for Ethereum futures ETF on May 7, and Michael Sonnenshein announced his resignation as CEO on May 20.

David Han, institutional research analyst at cryptocurrency exchange Coinbase, said in his monthly outlook that the SEC is unlikely to maintain its rejection decision as cryptocurrency becomes a greater issue for voters ahead of the upcoming November U.S. presidential election. "As cryptocurrency begins to become an election issue, we think it is less certain that the SEC will be willing to put up the necessary political capital to support a denial," he said.

As of writing, Bitcoin is trading at $69,672, and Ethereum's rally continues. It remains to be seen whether the market can maintain its bullish momentum when the Federal Reserve releases the latest Federal Open Market Committee (FOMC) meeting minutes later this week.

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