SEC’s Ethereum security stance could ignite price volatility ahead

Ethereum had hit a low of ~$3,000 recently. It has now retraced to a higher mark of $3,500 when articulating this piece. Nonetheless, uncertainty prevails, and Ether’s prices can swing either way. The closest resistance mark has been defined at $3,550. Technically, ETH is closer to its resistance level, poised to inch closer to $4,000. Its pair with the USD has to stay above the resistance mark to pave the way for the next ATH.

Bulls entered the picture when the price fell as low as $3,200. While it continued to downplay the bullish sentiments, the efforts played out to pull the market back on the graph. The token has now been up by 0.80% in the last 24 hours, further reflecting an increase of 19.505 in the previous 30 days, which reflects a fall of 5.67% in the last 7 days.

SEC’s attempts to classify Ether as a security

The US Securities & Exchange Commission, also known as the SEC, rolled out attempts to classify Ether as a security. It did so by issuing subpoenas to companies and asking them to label the token in the said category. The agency also asked them to share documents and records maintained with the Ethereum Foundation.

A final verdict could be delivered in May this year. Notably, that is the same month the Commission could approve Ether ETF. Ether ETF is the most anticipated ETF product since the approval of Bitcoin ETF. Analysts estimate the approval could mark an uptick at $14,000 by the end of 2025, provided it closes the current year at $8,000.

Gary Gensler, the SEC Chair, has refused to answer any questions. He had claimed in 2018 that Bitcoin and Ethereum were not securities. The stance has changed, which has triggered a strong reaction from the crypto sphere.

The most recent update for Ether comes from Prometheum. The crypto firm announced in February that it plans to offer institutional custody services for ETH. The Commission is now tasked with clarifying how companies can avoid liabilities related to certain crypto products.

Epic support from others for SEC to classify Ether as a security

The Commission is gaining support from Standard Chartered and the Co-Founder of Solana, toly. This does two things favorably. One, it increases the chances for Ether to be classified as a security. Second, it increases the chances of a surge in the token price. Standard Chartered has backed the predicted estimate of $14,000 by the end of next year. On the other hand, Toly has said that they are against the state if it is against Ethereum.

Standard Chartered’s predicted estimate is based on the fundamental assumption that its ETF will get a green light in May or later this year. That would boost the price to $8,000 by the end of 2024, then fuel the surge the following year. ETF has done wonders for BTC in due time. There is nothing to deny that the same can be done for Ether.

Dencun Upgrade is another factor that has been identified to boost the price of ETH. The upgrade comes with a commitment to reduce the transaction cost and increase efficiency. Thereby sparking higher adoption in the market. BlackRock and Fidelity have already applied to the SEC and are seeking approval for Ether ETF.

The predicted estimate of Standard Chartered is slightly backed by JP Morgan. The difference is that JP Morgan expects ETH to reach $5,000 by the end of this year.

Future implications of Ethereum – What should investors expect?

Investors can expect fluctuations throughout 2024. Prices will be volatile, bringing the dire need to allocate funds only based on one’s risk assessment. BTC will dominate the trend even though ETH’s gain may be higher.

Conclusion

The Commission’s attempts to classify Ether as a security are in the middle of the road, waiting for a direction. It remains to be seen how the companies react to subpoenas and if the classification becomes official. Standard Chartered has predicted the token will reach $8,000 if ETF makes its way to the market.