On Monday, Ethereum (ETH) experienced a significant surge, reaching $3,900 as investor sentiment turned bullish. The cryptocurrency is on track to surpass the $4,000 mark even before the launch of spot Ethereum exchange-traded funds (ETFs), reflecting a market that appears to be significantly “underallocated,” according to DeFiance Capital founder Arthur Cheong.
In a social media post on May 26, Cheong predicted that Ethereum, the second-largest cryptocurrency by market value, could climb to $4,500 ahead of the ETF trading launch. He supported his prediction with a poll indicating that nearly 50% of respondents have allocated only up to 25% of their portfolios to Ethereum, suggesting that the market may be underestimating its potential.
The U.S. Securities and Exchange Commission (SEC) approved multiple spot Ethereum ETFs on May 23 after a series of delays. This decision has heightened investor expectations that traditional market participants will inject new capital into Ethereum, similar to the surge seen with spot Bitcoin ETFs that helped Bitcoin reach a new all-time high of $73,750 in March.
However, ETF issuers still need the SEC’s approval for their registration statements, which detail investor disclosures. Unlike exchange filings, there is no set timeline for the SEC to approve these statements, creating uncertainty about the launch date for trading.
A source familiar with the matter told Reuters that the trading approval process could take days or weeks but did not provide specific details. Former SEC Chairman Jay Clayton, in an interview with CNBC, stated that the start of spot ETH ETF trading is a matter of when, not if, describing it as “inevitable” but acknowledged there are still some unresolved issues.
As of press time, Ethereum is trading at $3,910, according to data from CoinGecko. The market remains optimistic, yet cautious, as the exact timing of the ETF launches remains uncertain, potentially impacting ETH’s near-term price trajectory.
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