Spot Ethereum ETF approval could send ETH price to $5k, analysts say

Analysts at crypto trading firm QCP Capital say the unexpected approval of spot Ethereum ETFs could push the ETH price to $5,000 “later in the year.”

The price of Ethereum’s ETH native cryptocurrency could target the $4,000 mark as a “natural short-term target” if the U.S. Securities and Exchange Commission (SEC) approves spot Ethereum exchange-traded funds (ETFs).

Ethereum price in USD | Source: TradingView

In an analytical update on May 21, analysts at the Singapore-based trading firm noted that the second-largest cryptocurrency by market cap could reach $5,000 by the end of this year if the SEC surprises the market with its approval. But if the financial regulator rejects ETF applications, the market should expect an “ugly bounce back” to $3,000, where ETH has shown strong support multiple times at the $2,900 level.

“This uncertainty has led to higher volatility, but better trading may be on a spot futures basis, which is now returning over 10% again.”

QCP Capital

Following rumors of potential approval, the price of Ethereum rose nearly 20% on Tuesday, reaching $3,650. QCP Capital had previously warned that a “resounding lack of interest” in the market, combined with the approval of spot Ethereum ETFs, could “easily” push ETH to recent highs. Analysts warned that an unexpected confirmation could trigger a short squeeze, pushing ETH to new highs.

However, the SEC may still have an ace up its sleeve by introducing a nuanced distinction between Ethereum and staked Ethereum, classifying the latter as a security. According to Alex Thorn, head of research at Galaxy Digital, this strategy would be consistent with the SEC’s ongoing legal battles and investigations and would allow the commission to approve Ethereum ETFs while maintaining its established regulatory stance.