Ethereum could soon rocket upwards following the Securities and Exchange Commission's bombshell move to approve spot Ethereum exchange-traded funds (ETFs) last week, market analysts say.

After months of terse delays and limited engagement, Wall Street’s top regulator gave the green light to a long list of asset managers that had applied to offer an Ethereum ETF. 

Industry observers now foresee the second-biggest digital coin to shoot up even more in value.

Despite some likely downward pressure on the price of ETH due to anticipated outflows from the nearly five-year-old Grayscale Ethereum Trust (ETHE), Data firm Kaiko said Monday that the asset's value would rise over the long term. 

Kaiko said it came to the conclusion by looking at what happened to Bitcoin ETFs following their approval in January: investors who had put money into Grayscale’s GBTC product immediately wanted to cash out, as they couldn’t previously do so. This pushed the price of Bitcoin down—in the short-term.

“Once the ETH ETFs launch, it is reasonable to expect selling pressure on ETH from likely outflows or redemptions due to Grayscale’s ETHE, which has been trading at a discount between 6% and 26% over the past three months,” the firm said. 

“Overall, even if inflows disappoint in the short term the approval has important implications for ETH as an asset, removing some of the regulatory uncertainty which has weighed on ETH’s performance over the past year,” the firm added.

Greg Magadini, Derivatives director at blockchain data provider Amberdata, told Decrypt that there is definitely a “bull run here on this news,” even as it’s unclear when the actual ETFs will start trading.

JPMorgan, America’s biggest bank, said Friday that it expected the funds to start trading before November. 

When they do hit the market, Ethereum ETFs—just like Bitcoin funds—will give investors exposure to ETH, the second biggest digital coin by market cap, via shares that trade on a stock exchange.

Wall Street’s biggest regulator had been slow to give a response to the applicants and has pushed back decision deadlines. Analysts from the likes of Bloomberg and CoinShares said that such crypto funds would not get the green light by the May deadline. 

But things changed last week when rumors swirled that the regulator was going to say yes to the proposed products. Days later, it did—without press release or comment, but to the great elation of the crypto community.

The price of ETH soared upwards as a result. It hit $3,968 on Monday, marking a more than 30% rise over the past two weeks, per CoinGecko data. 

ETH still has to climb more than 20% to pass its 2021 all-time high of $4,878. 

Edited by Ryan Ozawa.