JPMorgan expressed skepticism about the Securities and Exchange Commission’s (SEC) likelihood of approving spot Ethereum exchange-traded funds (ETFs) by May, marking the first deadline for such approvals. According to Nikolaos Panigirtzoglou, a representative from JPMorgan, the SEC’s classification of ETH as a commodity, similar to Bitcoin, is crucial for approving spot Ethereum ETFs. Panigirtzoglou stated:
For the SEC to approve spot Ethereum ETFs in May, it would need to classify Ethereum as a commodity (similar to Bitcoin) rather than a security. This is far from given, and I wouldn’t put more than a 50% chance to the SEC classifying Ethereum as a commodity before May.
The SEC recently approved spot Bitcoin ETFs, a significant development after over a decade of rejections. Traders are optimistic that spot Ethereum ETFs could be the next in line for approval. However, Panigirtzoglou emphasized that the SEC is still signaling its stance, indicating that it views all cryptocurrencies outside Bitcoin as securities. Last year, JPMorgan suggested that U.S. lawmakers might create a new category for ETH to avoid classifying it as a security.
Will Ethereum Follow Bitcoin’s Footsteps?
Meanwhile, ETH’s price experienced a notable surge between January 10 and January 12, gaining 13.5%. This boost saw the cryptocurrency break above $2,650 for the first time since May 2022. The catalyst for this rally appears to be the recent approval of spot Bitcoin ETFs.
Investors question whether cryptocurrency can maintain its current market capitalization of $322 billion. Over the past 60 days, ETH’s price has outpaced Bitcoin’s positive move, gaining 27% compared to Bitcoin’s 24%.
The approval of spot Bitcoin ETFs was expected to increase Bitcoin’s price by opening up new opportunities for clients who could not directly acquire cryptocurrency. However, ETH’s recent surge has led to speculation about its potential to steal Bitcoin’s thunder in the market.
Bloomberg ETF analysts currently estimate a 70% chance of an Ethereum ETF approval by May, in contrast to a 95% likelihood for Bitcoin. Major asset managers, including BlackRock, Fidelity, Grayscale, and VanEck, are anticipating the final SEC decision on spot Ethereum ETFs by May 23. Some analysts, considering the precedent set by Bitcoin, believe the final decision might come sooner than anticipated.
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