Standard Chartered Bank predicts that Ether (ETH), the world's second-largest cryptocurrency, could surge nearly 70% and hit $4,000 by May on the high likelihood of the US Securities and Exchange Commission (SEC) approving spot Ether-based exchange-traded funds (ETFs).
Analysts at StanChart, led by research director Geoff Kendrick, believe the SEC will follow a similar approach as it did with Bitcoin ETF applications, delaying a decision until the application deadline and then approving it. May 23 is seen as the tentative approval date, which is the deadline for asset managers VanEck and Ark/21Shares to file their applications.
The report says that the market is currently undervaluing the probability of Ether ETF approval. StanChart sees "no fundamental reason" for the SEC to treat ETH differently than Bitcoin. The report highlights that ETH futures are also listed on the prestigious Chicago Mercantile Exchange (CME) and the SEC has not classified ETH as one of the 67 cryptocurrencies it deemed as securities in its lawsuit against Ripple.
Kendrick and his team write: "Looking ahead to the anticipated approval date of May 23rd, we expect the ETH price to track or outperform Bitcoin over a similar time frame."
Bitcoin's price surged 85% from around $25,000 in mid-June - when asset management giant BlackRock filed for an ETF - to around $47,000 when spot ETFs were approved on October 10.
The report also states that ETH would face less selling pressure after a potential ETF approval than BTC, because the Grayscale Ethereum Fund (ETHE) has a smaller market share compared to the Grayscale Bitcoin Fund (GBTC) in terms of total Ether market capitalization, and even the bankrupt exchange FTX held fewer ETHE shares.
