Standard Chartered Bank anticipates that Ether (ETH), the second-largest cryptocurrency, could experience a nearly 70% surge to reach $4,000 by May. The British bank bases this projection on the expected regulatory approval of spot-based exchange-traded funds (ETF) for Ether in the U.S. The bank’s analysts, led by Geoff Kendrick, suggest that the U.S. Securities and Exchange Commission (SEC) will likely follow a similar approach as it did with Bitcoin, delaying decisions on spot ETF applications until granting approval on the final deadline, potentially on May 23.
The report notes that the market is currently underestimating the likelihood of approval, emphasizing that there is “no fundamental reason” for the SEC to treat ETH differently from Bitcoin. Standard Chartered highlights that ETH futures are already listed on the regulated Chicago Mercantile Exchange (CME), and the SEC did not categorize ETH among the 67 cryptocurrencies considered securities during its legal proceedings against Ripple.
The analysts expect ETH prices to track or even outperform Bitcoin during the period leading up to the expected approval date on May 23. Comparatively, Bitcoin surged 85% from mid-June to January 10 when spot ETFs received approval. The report also suggests that ETH may face less selling pressure after a potential ETF approval compared to BTC due to the smaller market share of the Grayscale Ethereum Fund (ETHE) in relation to ether market capitalization, especially when compared to the Grayscale Bitcoin Fund (GBTC) and the impact of the FTX bankruptcy estate on shares.
Bitcoin experienced a significant drop from a high of $49,000 on January 11 when BTC ETFs commenced trading, reaching as low as $38,500, attributed in part to GBTC fire-sales that resulted in approximately $5 billion in outflows since its conversion into an ETF.
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