Ethereum ETF final approval may happen in July
NAIROBI (CoinChapter.com) - Analysts predict that the U.S. Securities and Exchange Commission (SEC) may approve an Ethereum ETF in July, having already approved Bitcoin and Ethereum futures ETFs. ETF Store President Nate Geraci expects the SEC to give final approval within 2 to 3 months. Bloomberg's Eric Balchunas sees July 4 as a possible date. This potential approval has important implications for investors and the market.


Posts by Nate Geraci on X
Followers are watching Grayscale Ethereum Trust (ETHE) closely following its approval. In January, Grayscale Bitcoin Trust (GBTC) saw $6.5 billion in outflows after the Bitcoin ETF was approved. ETHE, which manages $11 billion in assets, could face significant outflows. Kaiko estimates that if ETHE follows GBTC’s trend, daily outflows could average $110 million, equivalent to 30% of Ethereum’s daily trading volume on Coinbase.


Screenshot of James Van Straten's post
Crypto analyst James Van Straten is not optimistic about the possibility of large-scale outflows. He believes that Grayscale's low-fee Mini Trust ($ETH) is a mitigating factor. Van Straten pointed out that unlike GBTC, investors do not need to do anything with the Mini Trust. This may avoid outflows and retain investors.
Ethereum ETF Approval and Market Impact
The possibility of an Ethereum ETF being finally approved in July 2024 could have a significant impact on the cryptocurrency market. This follows the SEC's earlier approval of a spot Bitcoin ETF, which has led to a net inflow of $12 billion and a 78% increase in the price of Bitcoin in six months. However, while the price of Ethereum in 2024 has increased by 58%, the market's initial reaction to the approval was relatively mild, with Ethereum experiencing a slight decline.
The 4-hour chart shows a bearish RSI divergence, indicating a possible price correction. The RSI (Relative Strength Index) is making lows at the same time as the price is making highs, which suggests that Ethereum may pull back to the 50-day moving average at $3,705.1, or to the support area near $3,600 before bouncing back to the resistance level of $4,000. This divergence often indicates short-term weakness in the price trend, meaning investors should be prepared for short-term volatility.


ETH/USD 4-hour price chart. Source: TradingView
Ethereum is currently trading at $3840.4, down 0.41% in the past 24 hours. Its market cap is $465.75 billion, with a 24-hour trading volume of $19.07 billion. The circulating supply is 120,137,632 ETH. These figures highlight Ethereum's significant presence and activity in the market, highlighting the potential impact of ETF approval on its trading dynamics.
Possible Future of Ethereum ETFs
It is worth noting that the bearish RSI divergence on the 4-hour chart indicates a possible price pullback. The RSI (Relative Strength Index) is making lows at the same time as the price is making highs. Ethereum may pull back to the 50-day moving average near $3,680 or to the support area near $3,600 before bouncing back to the $4,000 resistance level. In addition, this divergence often indicates short-term weakness in the price trend, suggesting that investors should be prepared for short-term volatility.
Most importantly, if approved, an Ethereum ETF could increase liquidity and accessibility for investors, further integrating cryptocurrencies into the traditional financial system. However, the regulatory challenges associated with equity securities and the market's reaction to approval will be key factors to watch closely.