Will Ethereum Reach $10,000 This Year Amid its Spot ETF Approvals?

Simon Chandler | Verified by Elena Bozhkova

Last updated:

June 5, 2024 07:14 EDT | 4 min read

Ethereum is up by a healthy 20% in the last 30 days, with the approval of applications for eight spot-based ETFs being the major driving force behind this gain.

The SEC issued these approvals on Thursday, May 23, with its surprise decision sending the price of Ethereum to a two-month high of nearly $4,000, as traders went into a mini-frenzy.

Yet crypto’s biggest altcoin has stalled over the past couple of weeks, partly because the market remains indecisive and partly because the eight ETFs haven’t actually launched yet.

However, the eight applicants have begun filing the S-1 forms that will enable them to bring their funds to the market as early as this month, with their launches likely to bring a steady increase in volumes and demand that could see Ethereum reach record highs this year.

The Spot Ethereum ETF Story So Far

Ethereum exchange-traded funds have a history stretching back to April 2021, when the Canadian securities regulator approved the world’s first Ethereum ETF.

This was a spot-based ETH ETF managed by Purpose Investments, which had also gained Canadian approval for a similar ETF for Bitcoin in February of the same year.

Yet approval for spot-based Bitcoin and Ethereum ETFs seemed very elusive in the United States, with the Securities and Exchange Commission remaining opposed for years, based on its concerns regarding possible market manipulation.

The regulator’s stance began to change in the latter half of 2023, following its “disappointing” result in its case against Ripple, as well as in the wake of growing criticism from the cryptocurrency industry and its sympathizers in Congress.

By the end of the year, the SEC was meeting with Bitcoin ETF applicants and advising them on filing and refiling info prior to application deadlines.

Breaking from SEC- All 11 $BTC #Bitcoin Spot ETF’s approved. CBOE says Spot Bitcoin will begin trading tomorrow

— Mark Newton CMT (@MarkNewtonCMT) January 10, 2024

It ended up approving 11 spot Bitcoin ETFs on January 10, and although there was skepticism that Ethereum ETFs would soon follow, the regulator approved its first batch in May.

Ethereum Price Reacts

The news sent the price of Ethereum from around $3,100 to nearly $4,000 in only a few days after the approval.

Source: TradingViewIt has since calmed down to around $3,750, with the applicants still needing to file S-1 registration forms to launch their funds.

BlackRock has already submitted the S-1 for its ETF, paving the way for its arrival by the end of June.

Assuming the other funds follow soon after, the impact on ETH could be substantial, with analysts already beginning to predict big things for Ethereum based on the surge in demand that would follow.

Some of the predictions doing the rounds are quite impressive, with UK bank Standard Chartered recently forecasting an end-of-year price of $8,000 for ETH.

“After approval, we estimate that spot ETFs will drive inflows of 2.39-9.15 million ether in the first 12 months after approval,” said the bank’s head of digital assets research, Geoff Kendrick. “Given that we now see Bitcoin reaching the $150,000 level by end-2024, this would imply a level of $8,000 for ether.”

Other predictions range from relatively cautious to highly exuberant: analysts at AllianceBernstein suggested that ETH would largely ape BTC’s 75% gain since its own ETF approvals, implying a price of around $6,200 by the end of September.

Meanwhile, Nexo’s Andrey Stoychev predicted in May that ETH would touch $10,000 by the end of 2024, while crypto trader Lark Davis has gone as far as $15,000 by the close of the 2024-25 bull cycle.

ETH Outflows and the Future of Crypto

While investors should take ultra-bullish predictions with a pinch of salt, there has been evidence that a big price move may be coming as the ETFs prepare to launch.

Most notably, data from CryptoQuant has revealed that over $3 billion in ETH has been withdrawn from centralized cryptocurrency exchanges since the SEC approved the eight ETFs on May 23.

📉 Exchange balances for both #Bitcoin and #Ethereum are at their lowest levels in years!🔥

Whales continue to accumulate. #BTC on exchanges is down to 11.6% and #ETH is at 10.6%!

Supply squeeze incoming. 📈

Get ready for the next big move. 🚀 pic.twitter.com/u4j13DZBJk

— Leon Waidmann | On-Chain Insights🔍 (@LeonWaidmann) June 2, 2024

Therefore, it’s possible to suggest that Ethereum will perform well in the coming months. While $10,000 is probably the best-case scenario for this year, it seems highly likely that the coin will, at the very least, beat its current ATH of $4,878.

As for the wider implications for the industry, not everyone is certain that the Ethereum ETF approvals will soon lead to exchange-traded funds for other altcoins.

While Goldman Sachs’ Mathew McDermott affirmed at the end of May that the ETF approvals are a “big psychological turning point” for the industry, he argued that it was unlikely at this stage that they would open “the door for everybody else” to launch their own funds.

Nonetheless, there’s little doubt that the Ethereum ETF approvals are big for crypto, helping to provide greater legitimation for the sector as a whole.

For one, the approvals imply that Ethereum is a commodity rather than a security, thereby giving the industry more regulatory clarity going forward.

By making ETH attractive as an asset for mainstream financial institutions, the ETFs could direct greater capital towards the Ethereum eco, helping to fund the development of blockchain technology.

This is a big win for crypto, which may have begun an all-important phase of mainstream adoption.

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