SEC Approves Ethereum ETFs Amid Speculation And Market Movements

The U.S. Securities and Exchange Commission (SEC) has approved Form 19b-4 for eight Ethereum ETF issuers, including financial giants BlackRock, Fidelity, Grayscale, Bitwise, VanEck, Ark, Invesco Galaxy, and Franklin Templeton.

While this approval is a significant milestone, these issuers must still have their S-1 registration statements go effective before trading can begin. Bloomberg analyst James Seyffart speculates that this process could take several weeks.

The SEC has approved Form 19b-4 for eight Ethereum ETF issuers: BlackRock, Fidelity, Grayscale, Bitwise, VanEck, Ark, Invesco Galaxy, and Franklin Templeton. The ETF issuers still need to have their S-1 registration statements go effective before they can begin trading. It is…

— Wu Blockchain (@WuBlockchain) May 23, 2024

VanEck has already submitted an amended S-1 application for an Ethereum spot ETF. Bloomberg Intelligence ETF analyst Eric Balchunas anticipates that Ethereum ETFs will comprise 10-15% of the assets of Bitcoin ETFs, pointing to a lower institutional interest in Ethereum compared to Bitcoin. 

Researcher Noelle Acheson notes that the leading ETH futures ETF (EETH) holds around 4% of the assets of the leading BTC futures ETF (BITO).

Bloomberg Intelligence ETF analyst Eric Balchunas expects Ethereum ETFs to be 10-15% of the assets of the BTC ETFs. Several indicators suggest institutional interest in Ethereum is much lower than it was for Bitcoin, according to researcher Noelle Acheson. The leading ETH futures…

— Wu Blockchain (@WuBlockchain) May 24, 2024

Ethereum ETH Price Action Following Recent Happenings 

Despite the positive news of ETF approvals, Ethereum’s price has declined by 2.5%, suggesting a potential “sell the news” reaction. Significant transfers of Ethereum to exchanges have been observed, raising speculation about profit-taking or portfolio rebalancing. Notably, Ethereum co-founder Jeffrey Wilcke transferred 10,000 ETH (approximately $37.38 million) to Kraken.

Over the last two weeks, over 242,000 ETH have moved to exchange wallets, indicating increased trading activity and potential volatility. This trend coincides with the SEC’s approval of spot Ethereum ETFs, which has heightened industry expectations.

🧵Was the #Ethereum ETF a "sell the news" event? How low can $ETH go? Let's dive in! 👇

— Ali (@ali_charts) May 24, 2024

Analyst Ali Martinez has pointed out that the Tom DeMark (TD) Sequential indicator is flashing a sell signal on Ethereum’s daily chart. The current green nine candlestick suggests a potential price retracement or a new downward countdown phase.

The IOMAP data shows that the key support zone for Ethereum lies between $3,820 and $3,700, where 1.66 million ETH were purchased by 1.81 million addresses. If this support fails, the next critical support area is between $3,580 and $3,462. Conversely, the resistance zone between $3,940 and $4,054 needs to be overcome for Ethereum to invalidate the bearish outlook and potentially target $5,000.

Traders should remain cautious as increased ETH deposits to exchanges hint at possible sell-offs or profit-taking spikes, despite the bullish sentiment surrounding the ETF approvals.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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Image Source: sinenkiy/123RF // Image Effects by Colorcinch

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