Bitcoin ETFs to Gain as SEC Approves Ether ETFs

In a landmark move, the US Securities and Exchange Commission (SEC) has given the green signal for the potential launch of eight exchange-traded funds (ETFs) tied to Ethereum, the world’s second-largest cryptocurrency. This decision follows the previous approval of Bitcoin ETFs and marks a significant shift in the regulatory environment for digital assets.

The SEC’s approval of Ethereum ETFs marks a significant shift in its historical stance towards the crypto industry. Major legal victories, such as Grayscale’s success in appealing SEC decisions, have influenced the agency’s reevaluation of spot ETF applications.

Major Rule Changes Paves the Way

The SEC’s approval included important rule changes that make it easier for ETFs to invest directly in ether, Ethereum’s native cryptocurrency. Major financial institutions such as BlackRock, Fidelity, Grayscale, Bitwise, VanEck, Ark, Invesco Galaxy and Franklin Templeton received the green light. However, these products need further approval before they can be officially launched.

Notably, the SEC’s decision comes after months of anticipation, with the regulator unexpectedly providing feedback on pending filings earlier in the week. This swift action was likely due to approaching deadlines for responses to Ether ETF applications.

SEC Approval Expectations Promote Ether Rise

Anticipation around these confirmations has led to an increase in the Ethereum price of over 20 percent since Monday and over 60 percent since the beginning of the year. This increase shows that investors have increased confidence in the mainstream acceptance of cryptocurrency.

According to CoinMarketCap on Yahoo Finance, Ether currently has a market cap of more than $450 billion, accounting for about 18% of the cryptocurrency’s total market cap.

Industry Perspectives

Commenting on the development, Chainlink co-founder Sergey Nazarov, as quoted in the business community today, emphasized the importance of Ethereum ETF approval in promoting crypto adoption in capital markets. Similarly, CoinDCX Co-Founder Sumit Gupta hailed the SEC’s green light for spot Ether ETFs as a “watershed moment,” as the above source noted, nurturing mainstream adoption and reflecting a maturing regulatory environment.

Bitcoin ETFs Like to Rally for Ether Approval

The SEC’s approval sets the stage for Ethereum’s potential inclusion in investment portfolios, including retirement accounts and retirement plans. The SEC’s move will serve as a cornerstone for the entire crypto industry and will also boost bitcoin prices, which have been gaining traction since gaining approval earlier this year (read: 4 Reasons to Bet on Bitcoin ETFs for the Rest of 2024).

The story continues

Investors should also note that in Washington, a bill has passed the U.S. House of Representatives that aims to reduce the SEC’s influence on crypto and establish the Commodity Futures Trading Commission (CFTC) as the primary regulator for cryptocurrencies. This legislative push reflects evolving attitudes towards crypto regulation.

In this context, investors can follow bitcoin ETFs such as Grayscale Bitcoin Trust GBTC, iShares Bitcoin Trust IBIT, Fidelity Wise Origin Bitcoin Fund FBTC, ARK 21Shares Bitcoin ETF ARKB and Bitwise Bitcoin ETF Trust BITB to gain profits. Fund GBTC, IBIT, FBTC, ARKB and BITB increased by 1.31%, 1.23%, 1.19%, 1.24% and 1.15%, respectively, in the hours after May 23, 2024.

Want the latest recommendations from Zacks Investment Research? Today you can download the Top 7 Stocks of the Next 30 Days. Click to get this free report

Grayscale Bitcoin Trust ETF (GBTC): ETF Research Reports

iShares Bitcoin Trust (IBIT): ETF Research Reports

Fidelity Wise Origin Bitcoin Fund (FBTC): ETF Research Reports

ARK 21Shares Bitcoin ETF (ARKB): ETF Research Reports

Bitwise Bitcoin ETF (BITB): ETF Research Reports

Click here to read this article on Zacks.com.

Zacks Investment Research