Bitcoin and Ether ETFs Will Cause a Crypto Surge, Expert Says

Ether ETF approval signifies a narrative shift, providing another opportunity for digital assets to enter the market alongside major players.

Top cryptocurrency Bitcoin and Ether rose on Tuesday amid speculation that the Securities and Exchange Commission (SEC) will approve spot Ethereum ETFs this week.

The financial watchdog is set to decide on Van Eck’s spot Ethereum ETF application on Thursday and the Ark 21Shares application on Friday.

Meanwhile, Bloomberg Intelligence ETF analysts have increased their approval odds for Ethereum ETFs to 75%. Balchunas posted on Axios that the SEC “could be doing a 180” due to increasing political pressure. Crypto has emerged as a political topic in this election year, with presidential candidate Donald Trump making several pro-crypto statements during a campaign in May. Moreover, President Joe Biden is also taking a pro-crypto stance to garner support from the crypto community.

As of Tuesday morning, Bitcoin was trading at $70,000, up nearly 6%, while Ether was hovering around $3,700, up over 22%, according to CoinMartketCap. Ether's market capitalization of $440 billion now has surpassed that of payment giant Mastercard, which is valued at $427 billion.

The approval of Ether ETFs will cause a crypto surge, says an expert

“The narrative has shifted, and this provides another opportunity for digital assets to enter the market alongside major players,” said Jonathan Thomas, CEO and co-founder of Blueberry Protocol, a DeFi (decentralized finance) platform, in an email to Forkast.

In his view, the approval of Ether ETFs will help digital assets be recognized as something legitimate by regulators, while institutions will see the benefit of offering crypto services.

“As we saw with Bitcoin ETF approvals, the market will become more bullish as well. There's going to be a surge in buying activity and traders entering a ‘buy the news’ moment, which is likely to push Ethereum to an all-time high,” he added.

“The Ether ETF will also be the most profitable ETF for traditional finance as it includes the provisions for staking, and the asset itself will have a native yield.”

Why Ether is so important

Ether is the native token of the Ethereum blockchain network, which hosts thousands of decentralized applications and financial services, enabling investors to trade, borrow, and lend via automated software protocols instead of traditional banks or financial institutions.

The network has some unique features that Bitcoin lacks, bolstering its usability. For instance, Bitcoin’s blockchain network cannot be used as a platform for decentralized applications because it was not originally designed for applications to be built directly on its base layer.

This is part of the reason why financial giants such as BlackRock and Fidelity are interested in launching Ether funds, as they see Ether ETFs as a way to expand crypto’s investor base. In March, BlackRock launched its first tokenized fund on the Ethereum blockchain. BlackRock has repeatedly stated that its digital asset strategy involves launching ETFs and tokenizing financial assets.

In other related developments, Grayscale CEO Michael Sonnenshein resigned on Monday, just a few weeks after the company withdrew its application for a futures Ethereum ETF. Goldman Sachs’ head of strategy, Peter Mintzberg, will become its new CEO in August.