Michael Saylor Thinks Ethereum Is About to Take a Hit
He stated yesterday that "you will know at the end of May that the Ethereum ETF [exchange-traded fund] will not be approved" in the US. He made the remark during a conference he conducted for his event, Bitcoin for Corporations.
The businessman claims that with this kind of opposition, it will be abundantly evident to all that Ethereum is a security and not a commodity like bitcoin. He anticipates that other altcoins like BNB, Solana, XRP, and Cardano would be perceived similarly after that. Consequently, he thinks that none will—at least not anytime soon—be approved as ETFs.
Saylor believes that this incident will support the notion that bitcoin is the only digital commodity and that there is no second-best crypto asset. "It is becoming more and more evident that this decade will see no other cryptocurrency gain institutional acceptance."
These remarks are made three weeks prior to the SEC's (the US securities regulator) deadline for determining whether to approve the Ethereum ETF proposal from the VanEck business. Out of the seven on the table, this one is the first to expire with a date of May 23.
Analyst Michaël van de Poppe added today, "It is unlikely that the Ethereum ETF will be approved in May." But he believes that the markets are undervaluing an August approval. The review period for the proposal from BlackRock—the global asset management leader—expires in that month.
Even in the event that the SEC rejects VanEck's plan, it may eventually approve those of other businesses. Ethereum should do better, according to van de Poppe, who also stated that he believes there is a good likelihood of approval in August.
With a rise of over 35% thus far in 2024, bitcoin and ether (ETH), Ethereum's cryptocurrency, are performing similarly. Long-term, nonetheless, they represent a sharp contrast. At USD 59,000, the first is trading 19% below its all-time high set nearly two months ago, while at USD 2,900, the second is trading 38% below its record set in 2021.
However, there is a 25% likelihood of approval, according to exchange-traded fund analyst James Seyffart. The rationale is that, unlike with bitcoin, the SEC does not pledge to issuers regarding the specifics of the products.
On the last day before the initial proposal expired in January, the US regulator authorized bitcoin exchange-traded funds (ETFs). This came after years of denials, and some people are hoping that this month for ether, it will do the same.
Ethereum ETF approval might lead to an altseason
In order for ETF issuers to be prepared to start operations as soon as they are approved, they must first list on the DTCC. This action, however, does not guarantee that they will be approved.
"There might be a huge altseason once the ether ETF is approved," predicted Karan Singh Arora. By saying this, he alluded to a period of time when altcoins outperform bitcoin in terms of returns.
An altseason has historically been brought on by a spike in ether demand, which has started to materialize this week, after bitcoin demand.
This view illustrates the presence of differing perspectives regarding Ethereum ETFs in the US during a week that saw the approval of both these and bitcoin-based products in Hong Kong. It will therefore be important to observe whether the SEC's judgment is influenced by this action taken by the Chinese financial hub.
Exchange-traded fund expert Eric Balchunas explained that while the presence of ETFs in other nations may be a factor in price movements, the effect is not as great as that of the US market. Consequently, even though the ecosystem benefits from such items' acceptance in Hong Kong, it is thought that their advancement in the US is crucial.
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