Ethereum Soars 8% to $3,717 as ETF Talks with SEC Heat Up

• ETH surged to $3,717 over the past day, one of its highest levels in over a month.
• Experts believe the optimism stems from discussions between ETF issuers and the SEC.
• However, prominent analysts warn of potential rejection of ETH spot ETF applications.

Ethereum has surged to one of its highest levels in over a month as anticipation grows around the possibility of U.S. exchange-traded funds (ETFs) for the digital asset. Within the last 24 hours, Ethereum has hit a high of $3,717, soaring by over 8.2% from a low of $3,435. Notably, ETH crashed to as low as $3,111 in March.

Edward Chin, co-founder of Parataxis Capital, suggests the optimism surrounding Ethereum’s price surge stems from discussions between ETF issuers and the U.S. Securities and Exchange Commission (SEC). Chin remarked ,

There’s been some chatter about Ether ETF issuers meeting with the U.S. Securities and Exchange Commission.

Despite the SEC’s historical skepticism towards cryptocurrencies, especially regarding their classification as securities, the success of Bitcoin spot ETFs launched earlier this year has fueled hopes for similar products for Ethereum.

However, Bloomberg Intelligence ETF analysts James Seyffart and Eric Balchunas believe that concerns over the correlation between spot and futures markets could hinder the approval of Ethereum spot ETFs.

Specifically, in a note issued in late March, Seyffart and Balchunas assigned a 75% likelihood of the SEC rejecting Ethereum applications by May. They suggested that the SEC might rely on data indicating “relatively weak correlations between spot and futures markets” as a factor in their decision-making process.

In addition, reports suggest that the SEC is taking steps towards potentially classifying Ethereum as a security. This move includes requesting financial records from U.S. companies engaged with the Ethereum Foundation. 

Analysts speculate that this development could influence the SEC’s decision regarding the pending applications for Ethereum ETFs. Meanwhile, in an interview on Fox Business last month, BlackRock CEO Larry Fink expressed optimism. He noted that even if the SEC were to designate Ethereum as a security, it would not necessarily preclude the launch of an Ethereum spot ETF.