Standard Chartered Bank Predicts Ethereum (ETH) to Reach $4,000 by May Amid Regulatory Developments
Standard Chartered Bank anticipates Ethereum (ETH) reaching $4,000 by May, citing the potential approval of Ethereum Exchange Traded Funds (ETFs) by the Securities and Exchange Commission (SEC). The bank expects the SEC to follow a similar pattern to Bitcoin ETFs, with potential approvals by May 23.
Optimism is grounded in Ethereum’s regulatory status and its upcoming listing of regulated trac (exchange-traded funds) on the Chicago Mercantile Exchange (CME). According to the bank’s Tuesday report, ETH, the second-largest cryptocurrency by market capitalization, could surge by approximately 70%, reaching $4,000 by May, contingent on regulatory approval for Ethereum ETFs in the United States.
Ethereum ETFs on the Horizon
Standard Chartered’s research team, led by Jeff Kendrick, presents a logical foundation for their expectations. They believe the U.S. Securities and Exchange Commission (SEC) will follow a similar strategy to Bitcoin ETFs. Just as the SEC initially rejected Bitcoin ETF applications before granting approval, they expect a comparable trajectory for Ethereum ETFs. This pattern is projected to culminate in regulatory approval by the final deadline on May 23, coinciding with deadlines for applications submitted by asset management companies VanEck and Ark/21Shares.
Jeffrey Kendrick, Head of Foreign Exchange and Digital Asset Research at Standard Chartered Bank, explained, “We expect pending applications for ETFs in the United States to be approved by May 23, the final deadline for the first ETFs under review – the equivalent date to ETH’s January 10 for Bitcoin ETFs.” He added, “If ETH’s price performance is similar to how BTC performed in the period leading up to BTC ETF approval, it’s possible for ETH to trade at a high level of $4,000 by that time.”
This positive outlook for Ethereum ETFs relies on the historical stance of the SEC, which has not classified Ethereum as a security in its legal proceedings against cryptocurrency companies. Ethereum’s listing as a regulated trac on the Chicago Mercantile Exchange adds weight to the expectations of approval by the European Securities and Markets Authority. Kendrick emphasized, “Grayscale also has an ETH fund and wants to convert it into an ETF, so a rejection of this request could trigger another from Grayscale.” He concluded that there is no fundamental reason for the SEC to treat Ethereum differently from what the Chicago Mercantile Exchange is already doing.
Upward Perspective
Jeff Kendrick’s optimism extends beyond Ethereum to the broader cryptocurrency market. Earlier this month, he forecasted that Bitcoin ETFs could attract between $50 to $100 billion this year, potentially propelling Bitcoin’s price to $100,000 by the end of 2024 and $200,000 by the end of 2025.
While the $100,000 Bitcoin prediction remains within reach, Kendrick suggests that ongoing inflows into Bitcoin will elevate the overall market sentiment. In the last 24 hours, Bitcoin experienced relatively volatile market behavior, trading within a range of approximately $41,735 to $42,479 per unit. Despite this, the trading volume remained relatively low at $12.43 billion, with a market capitalization of $828 billion.
Analysis of Bitcoin’s moving averages reveals a cautiously optimistic trend, particularly in shorter periods (10, 20, 30 days). However, the 30-day and 50-day simple moving averages provide a bearish signal, urging traders to exercise caution in the long term.
In conclusion, the cryptocurrency market remains dynamic and unpredictable, with Ethereum ETFs potentially reshaping the landscape in the coming months. While Standard Chartered Bank’s predictions point towards an upward trajectory for Ethereum, market complexities require vigilance and precise analysis. As investors and enthusiasts monitor these developments, the world of cryptocurrency continues to present challenges and opportunities alike.
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