Hopes for Ethereum Spot ETF Approval Boosted by U.S. Politics

Hopes for Ethereum Spot ETF Approval Boosted by U.S. Politics

Optimism around the mass adoption of Ether surged after reports surfaced that the U.S. Securities and Exchange Commission (SEC) might approve an application for a spot Ethereum Exchange-Traded Fund (ETF). This shift in the SEC's previously passive stance on Ethereum spot ETFs has sparked speculation that political interests may be influencing this change.
In anticipation of this possibility, the price of Ether has soared since Tuesday, May 21, 2024, reaching $3,765. Bloomberg ETF analysts Eric Balchunas and James Seyffart estimate the likelihood of this investment product's approval has increased to 75%. Additionally, a recent Reuters report revealed that the SEC has requested U.S. stock exchanges like Nasdaq and Cboe to promptly revise their 19b-4 filing forms from issuers, signaling that an approval could happen as early as this week.

Political Influence in the U.S.

The SEC's current decision indicates a shift from its previously less enthusiastic stance towards such applications. According to The Block, internal sources suggest this situation is unprecedented, pointing to significant political factors at play. This argument is bolstered by a post from Balchunas on X (formerly Twitter), indicating that the SEC's shift in attitude is related to "increasingly political issues."
The U.S. is currently in the midst of a campaign season leading up to the general election. Donald Trump, the Republican presidential candidate, has initiated efforts to garner support by accepting donations in cryptocurrency. Furthermore, he has released a collection of Trump Digital Trading Cards in the form of NFTs. Trump's approach is seen as markedly different from that of U.S. President Joe Biden, whom he considers to be less knowledgeable about crypto.

On the other hand, the U.S. Democratic Party, which is nominating Biden for re-election, recognizes the importance of securing the support of younger voters who tend to have an interest in crypto. By approving a spot Ether ETF, Biden is anticipated to win the favor of crypto enthusiasts across the country.

Conclusion

The prospect of the SEC approving a spot Ethereum ETF has generated significant optimism regarding the mass adoption of Ether, evidenced by a notable surge in its price. This potential shift in SEC policy, which analysts now estimate has a 75% chance of approval, appears to be heavily influenced by the current political climate in the U.S. As the nation gears up for its general election, both major political parties are seeking ways to appeal to cryptocurrency enthusiasts. Donald Trump's proactive stance on crypto, contrasted with Joe Biden's approach, underscores the political dimension of the SEC's changing attitude. If the SEC approves the spot Ether ETF, it could mark a strategic move by the Biden administration to win over the growing demographic of young, crypto-savvy voters, further intertwining the future of cryptocurrency with the American political landscape.

Read Too : Bitcoin Price Surges to $71,200, Driven by Positive Sentiment Around ETH Spot ETF

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