Ether Surges 17%, Polymarket Approval Chances Rocket as ETF Makes Regulatory Progress

The CoinDesk 20, a measure of the performance of the market’s largest digital assets, is up almost 8%.

CoinDesk reported towards the close of the U.S. business day Monday that the Securities and Exchange Commission had make abrupt progress in the approval of a Ether ETF by asking exchanges to update 19b-4 filings for ether ETFs.

The SEC asking exchanges to update 19b-4 filings, which propose rule changes, suggests potential progress toward spot Ether ETF approvals. Despite the progress with 19b-4 filings, the SEC could still reject the S-1 registration statement of the ether ETF, delaying its approval and trading commencement.

As a result of this significant development, the ether implied volatility curve, which shows market expectations of future volatility across different strike prices and expirations, flattened as 25-delta risk reversals hit YTD highs above 18%, and traders heavily bought $4000 calls for 24 May 2024 and 31 May, Presto Research analysts wrote in a note shared with CoinDesk.

A Polymarket contract asking if an ether ETF would be approved by May 31 jumped from 10 cents to 55 cents, representing a 55% chance that approval will take place by May 31.

Another Polymarket contract asking if the ETF will be approved by June 30 is currently trading at 68%.

A decision on VanEck’s proposed ether ETF is due on May 23, followed by Ark’s on May 24.