The hopes of getting approval for a spot Ethereum ETF approval by May is dwindling. Banking giant Standard Chartered has recently reversed its optimistic forecast on the possibility of getting the United States Securities and Exchange Commission (SEC) to greenlight the asset class by the end of next month.
Expectations Dwindling Over Spot Ethereum ETF
According to Geoffrey Kendrick, the Head of Forex and Digital Assets Research for Standard Chartered revealed in a report earlier today that the expectations it had held before now was that the markets regulator will greenlight the applications.
Spot Ethereum ETF as an investment product is expected to give institutional investors a means to gain exposure to the underlying asset. To bring this product to life, many asset managers cutting across both crypto and traditional financial ecosystems filed applications with the US SEC in 2023.
With big names like BlackRock, Fidelity Investments and Grayscale Investments in the race, the SEC has delayed giving a decision thus far. With all the delays the deadline for VanEck’s ETF application is now set for May 23. Several events have contributed to cast doubt on the likelihood of gaining approval with the SEC reportedly looking to designate Ethereum as a security.
According to Kendrick, Standard Chartered’s certainty before now hinges on the idea that the approval process will follow that of spot Bitcoin ETF. However, at this time, the communication between the regulator, applicant, and key stakeholders suggests the reverse might be the case this time.
Longer Term Prospects
Despite expressing pessimistic stance over the chances of a spot Ethereum ETF in the short term, the projection for the long term is more bullish.
“A higher BTC price would also boost ETH; and even if the US ETF is not approved in May, the global environment for ETFs continues to improve, and we expect eventual U.S. approval,” he concluded.
The bank has maintained its $8,000 price target for Ethereum by the end of 2024, a significant boost from the $3,217.35 it is currently trading at per data from CoinMarketCap.
