Spot Ether exchange-traded funds (ETFs) clearance is still pending, but Kevin de Patoul, CEO of Keyrock, a provider of digital asset markets, stated in an exclusive interview on February 23 that things are far from “done deal.”
“I do believe there’s a good chance Ether ETFs will be approved. Without a doubt, the likelihood is greater than 50%. But I do believe that it’s not finalised either.
Since financial management firm Bernstein recently predicted that Ether might be the only other cryptocurrency to obtain an ETF this year, Ether ETFs have taken centre stage in the cryptocurrency sector. By May 2024, Bernstein predicts a 50% likelihood that ether ETFs would be approved.
The major investment bank JPMorgan predicts a 50% likelihood of an Ether ETF by May, while Eric Balchunas, senior ETF analyst at Bloomberg, projects a 70% chance of approval. By the end of May, polymarket odds indicate a 42% possibility of an approved ETF.
According to Keyrock’s de Patoul, there will likely be more obstacles before the Ether ETF is approved, much like there were when the first Bitcoin ETFs were approved in the US.
The main worry is that Ether might be categorised as a security by Securities and Exchange Commission (SEC) Chairman Gary Gensler. Despite former SEC Division Director William Hinman’s rejection of the idea in a 2018 speech, Gensler has refrained from answering whether or not he believes Ether poses a security risk during prior congressional hearings.
De Patoul maintains that while Ether is not a security, the adoption of staking yield following last year’s merge moved Ethereum to a proof-of-stake consensus architecture, which may give the impression that it is from the SEC’s point of view a security offering.
On February 20, after Ether broke above the $3,000 psychological price mark for the first time in 22 months, interest in Ether ETFs was rekindled.
De Patoul of Keyrock claims that the enthusiasm surrounding a possible spot ETF and the impending Dencun upgrade is mostly responsible for Ether’s current price action, which is a compound effect. “By increasing scalability and reducing gas fees, the Dencun upgrade will improve the network and create more value for Ethereum, which translates into positive price action.”