Analysts Indicate Increasing Doubt as Approval Chances for Ethereum ETF Drop to 35%

The U.S. Securities and Exchange Commission’s long-awaited approval of a spot Ethereum ETF is facing a significant setback, as Bloomberg ETF analysts estimate the chances of approval at only 35%. This marks a substantial decline from earlier predictions.

Analysts attribute the low probability of approval to a lack of progress and political pressures. Bloomberg Senior ETF Analyst Eric Balchunas disclosed the gloomy news, stating that the odds are now at 35%, a significant difference from his initial prediction of a 70% chance of approval by May.

James Seyffart, another analyst, who previously estimated the odds of approval at 60-65%, now seems to have lost hope, stating that the Ethereum ETF cycle is going in the opposite direction of Bitcoin ETF approval odds.

Investment experts are warning that the lack of modification in the Ethereum ETF applications in the latest filings is a red flag. This pattern has historically preceded the approval of Bitcoin ETFs. Negative indicators, such as a lack of market makers and SEC statements, indicate the stance of the SEC.

GSR, a crypto market-making firm, has stated that they may lower their approval odds if they do not see any positive changes in the coming weeks.

In addition to the lack of progress, political pressures from figures like Senator Elizabeth Warren and regulatory obstacles have made the SEC cautious in approving any Ethereum ETFs. The recent delay in deciding on plans by banking giants BlackRock and Fidelity has added to the uncertainty. Analysts argue that this delay is the reason behind the SEC’s careful approach and the market volatility.

The SEC’s conservative approach may also be influenced by political opposition and a desire to learn from past mistakes in approving cryptocurrency ETFs.

As the May 23 deadline approaches, uncertainty surrounds the approval of Ethereum ETFs. The once enthusiastic attitude toward approval has now been replaced with uncertainty.