Rumors of a potential approval of Ethereum spot ETFs have fueled a full day of gains for the Ethereum ecosystem, with the price of ETH skyrocketing 20% intraday to just shy of $3,700—trading at $3,687 at time of writing—and sister tokens Arbitrum (ARB) and Optimism (OP) both notching gains of 18% on Monday.
The optimistic mood had already spread to other cryptocurrencies, including Solana (SOL) and Avalanche (AVAX), which are peaking above $40 and $188 respectively, as of this writing, representing more than 25% gains over the last seven days for both.
The sudden rally to start the week was sparked moments after two Bloomberg ETF analysts—Eric Balchunas and James Seyffart—revealed their joint prediction that the Securities and Exchange Commission could approve Ethereum spot ETFs when its first major deadline comes later this week.
Their updated odds were 75%, a huge upgrade from their prior estimate of 25%—which was already more pessimistic than other analysts who placed the chances at 50-50 earlier this year.
Update: @JSeyff and I are increasing our odds of spot Ether ETF approval to 75% (up from 25%), hearing chatter this afternoon that SEC could be doing a 180 on this (increasingly political issue), so now everyone scrambling (like us everyone else assumed they’d be denied). See… https://t.co/gcxgYHz3om
— Eric Balchunas (@EricBalchunas) May 20, 2024
Crypto oddsmakers are certainly shifting their views, with the collective probability of an Ethereum spot ETF approval by the end of the month leaping from 10% yesterday to 61% as of this writing.
As with the long and meandering Bitcoin spot ETF approval process, the SEC has systematically delayed making a decision on the Ethereum equivalents. Hopes for approval have steadily dimmed, with fears peaking that this week’s deadline would prompt the federal regulator to outright declare Ethereum a security, decisively separating it from the commodity status enjoyed by Bitcoin.
Late last week, however, leading cryptocurrency exchange Coinbase said it saw Ethereum spot ETFs as an eventuality—if not immediately approved on May 23.
All of this came as top coin Bitcoin was in the middle of its own rally, the price of BTC clearing $70,000 earlier in the day amid massive short-position liquidiations—heights not seen since April 12, and approaching the $73,737 all-time high set in March.
The good mood was contagious, and by late Monday, the top 25 cryptocurrencies by market cap were all green for the day—and for the prior 7 days.
Among meme coins, Bonk and Pepe are both up more than 20% in the last 24 hours.