Will The $ETH ETF Be Approved? | RSA+DH

This episode discusses the potential approval of an Ethereum (ETH) Exchange-Traded Fund (ETF) by the Securities and Exchange Commission (SEC) and its implications for the crypto market.

1. The probability of ETH ETF approval has increased to 75% due to political pressure.
2. The SEC's decision is influenced by the upcoming 2024 presidential election and the crypto voter base.
3. Approval of the ETH ETF could lead to significant market movements and increased institutional participation.
4. The Democratic Party is divided on the issue, with younger Democrats being more pro-crypto.
5. The ETH ETF approval represents a potential shift in U.S. crypto policy and regulatory environment.

1: Introduction

Overview of the current state of the ETH ETF approval process and initial reactions.

• "Ryan Sean Adams: Do we have an ethereum ETF on the menu?"
• "David Hoffman: We are increasing our odds of spot ether ETF approval to 75%."

2: Political Dynamics

Discussion on the political factors influencing the SEC's decision.

• "David Hoffman: Hearing chatter this afternoon that the SEC could be doing a 180 on this increasingly political issue."
• "Ryan Sean Adams: Many Democrats nonetheless disregarded that and voted to repeal SAB 21 21."

3: Market Reactions

Analysis of market reactions to the potential ETF approval and price movements.

• "David Hoffman: If it is indeed political pressure, then it is getting approved."
• "Ryan Sean Adams: We are currently pricing in $3,430 on the ETH chart."

4: Institutional Involvement

Exploration of the role of institutional investors and their potential impact on the market.

• "Ryan Sean Adams: Institutional investors who wanted access to crypto had no ability to buy crypto aside from bitcoin."
• "David Hoffman: Institutional investors are front running the actual approvals."

5: Broader Implications

Discussion on the broader regulatory and policy implications of the ETH ETF approval.

• "David Hoffman: This is a shift in DC, and it's basically the democratic establishment saying, hey, being anti-crypto fight is not going to win the presidential election."
• "Ryan Sean Adams: We might get the headwinds in our favor for some brief period of time."

1. Stay Informed: Regularly check credible sources for updates on the ETH ETF approval process.
2. Monitor Market Movements: Keep an eye on ETH price charts to make informed trading decisions.
3. Engage Politically: Participate in crypto-related political discussions and advocate for favorable regulations.
4. Diversify Investments: Consider diversifying your crypto portfolio to mitigate risks.
5. Educate Others: Share knowledge about the potential impact of the ETH ETF approval with fellow investors.
6. Evaluate Institutional Trends: Watch for trends in institutional investments to anticipate market shifts.
7. Prepare for Volatility: Be ready for potential market volatility around the ETF approval announcement.
8. Leverage Educational Resources: Utilize available educational guides and articles to enhance your understanding of crypto investments.
9. Consider Long-term Investments: Think about the long-term potential of ETH and other cryptos in your investment strategy.
10. Stay Engaged with the Community: Join crypto communities and forums to stay connected and informed.

The ETF approval deadline is coming on May 23rd and the odds just got.... wayyyy higher! Ryan and David explain.

People

Ryan Sean Adams, David Hoffman, Eric Balachunas, James Seyffart

Companies

Bloomberg, SEC, Kraken, Coinbase, Blackrock, Fidelity

Books

None

Guest Name(s):

None

Content Warnings:

None

Ryan Sean Adams
What is going on, David? Do we have an ethereum ETF on. The menu, possibly in the middle of a meeting that we are having at bankless? We interrupt the meeting because Eric Balachunis, who knows a thing or two about the ETF, is one of the two, quote, unquote, ETF boys. ETF guys.

Bloomberg Bros. Is what they call Bloomberg. Yeah, the Bloomberg Bros. The ETF bros. Tweets out, update James Safer.

David Hoffman
The other, the other ETF bro and I are increasing our odds of spot ether ETF approval to 75%, up from 25%. Hearing chatter this afternoon that the SEC could be doing a 180 on this increasingly political issue. So now everyone is scrambling like everyone else assumed they'd be denied. See Nate sweep below for proper order of events. And so this has got to be a reaction to sab 121, the 60 to 38 vote with a meaningful amount of high ranking Democrats defecting from Biden stated policy of the fact that he's going to veto SAP 21 21.

Many Democrats nonetheless disregarded that and voted to repeal SAB 21 21, indicating that not all of the Democratic Party are in alignment with being anti crypto as a result of that. It seems that that's speculation, but it's pretty, that's pretty speaker one, I think. Look, he said, he said increasingly political pressure. This is what we've said. And so something is going on behind the scenes.

Eric and James would know about the SEC and the ETH ETF being approved. Yes. To me, like, they are upping it to 75%, which means, of course, there's a one in four chance that it's getting denied. In my opinion, the fact that this is happening at now, it's happening now. It's pretty binary.

It's just very bullish. So Thursday, May 23, is when the SEC has to either approve or deny it. Okay, so it's Monday right now. So the fact that it's happening now tells you something. And both Eric and James, their sources for all of this, basically all, all along they've been saying the same message.

Ryan Sean Adams
If it was going to get approved toward the end of May, we would have seen it in the paperwork. They monitor the docs, they monitor the filings. They sort through, like, the sifting of everything that's going on in, like, the filings. They keep track of it. And their constant refrain has been, there's no way it's getting approved, like, under 25% odds.

In fact, David, let's go to James's Twitter right now, because I recall, like, seeing earlier, just today, that, like, look at this, this is from May 17. All right. This is not today. But he said it's just not happening, guys. Talking about the Ethereum ETF, and, which.

David Hoffman
Is an accurate take for the data that he had at the time. Exactly. Because they haven't seen anything come through. But this is, this was kind of the Hail Mary pass, like the if that we talked about on the roll up last week. We said if, and this is a big if.

Ryan Sean Adams
If Biden and the Democrats wake up at the 11th hour and realize anti crypto Gensler is about to lose them the White House, they may pressure Gensler to achieve, basically, politics trumps all in, particularly in election year. And this is what Eric is saying. Basically, it could be political pressure that is motivating Gensler and the SEC to actually approve. Now, again, we don't have 100% certainty here, but what we're taking from Eric and James is that they are seeing documents move. They are seeing, like, good signs, paper filing at this 11th hour.

And what else could that mean? So they have increased the odds of approval by two. Over 200% right now. Yeah. Up to 25%, which was very low.

David Hoffman
Probably even, I think people were accounting for even lower than that. Up to 75%. To me, this is binary, right? If it is indeed political pressure, then it is getting approved. And it's getting approved in the final hour because the Biden administration has realized that it's a close election and there is enough of a crypto vote out there to be meaningful.

And they, they want to be reelected more than they care about denying the spot ether, ETF. Can we, can we pull up in the Kraken price chart so we can look at the price of ETH, please? Yes. When ETH, it pumps in slow motion. Actually, this is all we got.

Well, that's, that's a one day candle short. Let's shorten it down to the 15 minutes candles on the. Okay, thanks to Kraken for the charts. There you go. That's what we like.

Whenever I have seen ether pump ever, it always pumps slowly over a long period of time because this market hates, has not gone down since, like, this. This news got improved. So this is like, the market is currently digesting this. We are currently on the fourth baby pet candle here. I see.

Ryan Sean Adams
What's that? Well, that's on the 15 minutes. On the 15 minutes to me, like, we are currently pricing in $3,430 on the ETH. On the ETH chart. To me, we are if, again, if it's getting approved, we are so far away from actual meaningful price equilibrium.

Like, this is so cheap. This is so dumb. Like, we are not done yet. We got 12% pump. Twelve hair.

David Hoffman
12%. That's a baby. ETF approval. This is like 1%. If, if approved, this is at like 1% priced in.

Ryan Sean Adams
Not financial advice. Not financial advice. David is saying by now, but not financial advice. This is, I mean, okay, so the, the price is pumping. Let's go back to James Safford street tweet because you read Eric Baltun as he says, things are taking a turn for the better spot.

Ethereum ETF approvals this week, upping our odds to 75%. He says this. Never going to hear the end of that. They're not hacked. Yeah, yeah.

He had to confirm he's not hacked. Never going to hear the end of this from the eats people in my replies. If this turns out to be true, but it's what we're hearing from multiple sources. Should see a bunch of filings in the coming days. If we're correct, I will know that both David and I reached out to James and Eric, and I don't think they can actually, we invited them to come on the live stream.

And by the way, James, Eric, if you guys are listening, come on live stream. Let's tell us what you know. We got the sense that they actually can't reveal more than what they've already revealed on Twitter at this point. Bloomberg, they have to push it through. Bloomberg.

David Hoffman
Bloomberg, their media organization. Yes. And also I think that there's probably this is happening so last minute. They're still trying to figure out, like, what exactly is going on, but, um, you're like, glad they got this, uh, this tweet out. Um, David, uh, is this a little life on the ratio here?

A little bit low. An ETH ETF approval with the ETH bitcoin ratio below 0.05 is insane. You know that the market isn't even pricing this inappropriately when poly market. I think you have that tab ready. Poly market is pricing it in at 50%, hit refresh, and then hit like, the one day time.

Ryan Sean Adams
This is the poly market, the prediction market. Odds of approval of Ethereum ETF approved by May 31. Okay, so it is getting up to 75%. Yeah. Okay, so, like, basically this information is informed by the blue ETF people.

David Hoffman
People. Look, dude, it was, it was 13% this morning. 13% up to 75%. Approaching 75%. Currently, 69%.

Nice. Also, Eleanor Terrett, who is another, like, commentator on the markets and crypto news, she says this is her. Her as a primary source now saying an issuer, one of the ETF issuer sources tell me that things are evolving in real time, like Blackrock, bit widely, fidelity. They are reacting right now in real time. Anyone who works at one of those companies right now is currently in their Slack channel, like, asking, freaking out what the f is going to get.

What do we need to change about our ETF, like, application? Like, what's going on? Are we going to get approved? I'm sure the SEC office is also freaking out right now. Shout out Gary Gensler, who I'm sure is watching this channel.

I'm sure you're freaking out. Um, yeah. So, like, what do you mean freaking out? I mean, I think he's probably pretty calculated in this. He probably got some phone calls over the weekend and late last week.

Ryan Sean Adams
Um, I. Who knows how this works behind the scenes, but, yeah, there's political pressure. Okay. So the reason I'm in a collared shirt, by the way, is just like, uh, I know you guys think I usually dress like this. David.

David switched. I didn't get a chance to switch is because earlier today we had an episode recording with Representative Patrick McHenry. So this is a former chair of the House, interim chair of the House, I should say, and a crypto advocate. So. And he was talking to us about the political pressure that's happening in Washington.

Basically, DC has just woken up and they're realizing right before the 2024 elections, a president, major presidential election, probably one of the historic election, that the crypto populace has a chance of swaying election outcomes at this point in time, which is absolutely crazy because, like, 20% of people in swing states are potentially crypto voters and care what politicians think about crypto. And so what's happening is last week and then also this week, basically, politicians are having to go on the record as to whether they're pro crypto or anti crypto. The SAB 121 repeal was them going on the record. And you saw even Senate Majority lead Chuck Schumer, the most Democrat of Democrats, forsook the White House and, like, and, you know, against, against their policy. And he actually voted pro crypto.

And so there's another bill going from the House this week that Patrick McHenry is talking about, which is called fit 21. And this is more pro crypto legislation. It's going to be yet another opportunity, maybe even a bigger opportunity, for politicians to get on the record and say whether they're pro crypto or anti crypto. And he was very clear that, like, this has become an actual election issue. In DC, and politicians are waking up to it.

David Hoffman
And not just an election issue. People have been saying crypto is now a partisan issue. It's now like the right versus the left. But what we saw with a Sab 121 bill is it's actually splitting the Democratic Party, where you have the establishment, like, older generation Democrats, the Biden, the warrens, the genslers, as the anti crypto party, but the younger Democrats, and like, many of those people not in those circles, as, like, pro crypto. So it's basically the entire Republican Party, pro crypto, younger Democrats, pro crypto, and this current Biden administration as anti crypto.

And so the Biden administration realizes that they're on an island with not very many voters in an election year, in a contested election. So, like, it's a simple calculus. Can we just take it in for a minute of just, like, if this is how it happens, this would be the most crypto thing ever. This timeline is fantastic, which is basically. Everyone expected the SEC to deny it.

Ryan Sean Adams
It was just denied. Denied. Guys, they have lawsuits against five crypto companies. Joe Lubin just came on the bankless podcast three weeks ago, and it's like they're out to get Ethereum, right? They're looking at the Githubs.

They're, they're trying to make the case that Ethereum itself is a. Is a security, is all of this evidence. And he said there's no chance that they'll approve it. And now, potentially, again, we don't know for sure about this, but potentially, this could be approved. This would be the most crypto thing ever if this happened.

David? Yeah. The timeline, I think, is, like, pretty perfect. Mike Capolito was calling for, like, ETH sentiment, bottom calls just last week. ETH sentiment, just like, in the absolute, like, dumpster.

David Hoffman
Like, just vibes, just really bad. What was that? Okay, so I was barely paying attention to this on, like, crypto Twitter, but it just, like, felt very much that. I mean, people were blaming Farcaster that all. Yeah, like, the Ethereum leadership.

Ethereum thought leaders just have, like, abandoned Twitter. They're all on Farcaster now. No one is left on Twitter defending ETH sentiment. The narrative. The narrative is dead.

And, yeah, like, meme coins are on Solana ETH not getting its ETF, like, all this kind of stuff. We actually have a bunch of these tweets talking about this, like, lined up. We got some tweets from Eric Connor. We got some tweets from Jake Sherwinski. We got James Safir talking about how the ETH were wishcasting.

Then we also got some technical analysis, not from me, but from other people who I trust that I want to pull up on the screen. And then we got some gifs about Anthony Susano. So we're going to pull up all of these tweets and more. But first, a moment to talk about some of these fantastic sponsors that make this show possible. If you want a crypto trading experience backed by world class security and award winning support teams, then head over to Kraken, one of the longest standing and most secure crypto platforms in the world, Kraken is on a journey to build a more accessible, inclusive and fair financial system, making it simple and secure for everyone everywhere.

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That's Team o K U.com. The new meme is that goddamn ETH are about to become insufferable again. If you don't know what a dot ETH, that's somebody on twitter. That's the ethereum tribe on Twitter, people who have ETH in their name. As you can see, that's one of, it's what I have as a cryptopunk ETH.

I would call myself an archetype of a ETH on Twitter. And this is just like, the sentiment is going to shift with it, with the spot ETH ETF. I know you know this, Ryan. If the spot ETH ETF gets approved, the market is so underway ETH. It's been underway ETH this entire bull market.

The market became overweight ETH in the bear market because it was like the flight to safety ETH and bitcoin performed shoulder to shoulder in the 2022 decline of crypto prices. But since the bull market has resumed like just people have, people are already overexposed because of the safe haven that ETH was. And in the bull market, people were dispersed away from ETH. Now, like the market is completely underexposed to ETH, people have priced in an ETF disapproval. Meme coins are on Solana.

Bitcoin has this bot ETF approval. So people, and like ETH has all the regulatory pressure, like ETH has all the lawsuits, like the Department of Justice is going after applications on Ethereum. And so, like, I think the, the sentiment pendulum shift is going to swing so strongly just because it's so underexposed. The market is so underexposed. Oh, it's going to be, it's going to feel like whiplash.

Ryan Sean Adams
Right? It's good. I think, I think there's going to be a lot of ETH bulls that are very excited because this has been a very lackluster bull market for Ethereum up to this point. Right. And it's just so, so let's talk about this for a second.

If this happens again, it's an if. So if you missed the first part of the show, we were talking about, you know, you know, the approval odds of an Ethereum ETF going up. This is according to Bloomberg, they're, they're seeing stuff happen in the background, right? They're seeing papers being filed. They're seeing issuers giving positive sentiments.

And this is kind of breaking as of the afternoon of May 20. But if this happens, David, I want to ask you, do we just like, do something similar to bitcoin pricing in its ETF approval? And I feel like that started happening. Would you say around October 2023? October 2023 is a good time?

I was going to say September. October 2023, because that was when the grayscale case was. Was pretty one, definitively in bitcoin's favor. But like, that time zone, I think. October 2023, excuse me, October 2022 was when it was announced that Grayscale had filed.

David Hoffman
And then it took the market like six months to really absorb what that meant. And then it was November of 2023, about a year later, when that actually got approved. That's right. It was like six months leading up to that approval with a slow crescendo of price action. It started getting priced in around this, this area right here.

Ryan Sean Adams
And like, then we saw just like this steady march upwards of bitcoin price. I think that this will, Ethereum will do this and more because, like, more because it will be an amplifier effect, because smaller market cap, of course, but also Ethereum had, like, higher regulatory risk. You know that Gensler was always cagey, the SEC was always cagey about whether ETH is a security or not. And so it had this perceived regulatory risk. And so institutional investors who wanted access to crypto, right, they had no ability to buy crypto aside from bitcoin.

And if all of this is wiped away, I think Ethereum has, like, a bigger Runway. It's going to be an amplifier of what happened to bitcoin. Yeah, I think you have Jake Stravinsky's tweet somewhere towards the end there, and he just echoes this same sentiment. He says, if the spot ETH ETF is approved, it will be a true shock to everyone I know in DC who's close to this process. It means approval could shift, a major shift in us crypto policy after the SAB 121 vote.

David Hoffman
More important, perhaps more important than the ETF itself. And so, like, that's interesting in the Capitol Hill about Ethereum ethy asset, about, like, securities versus commodities, about, like, is there's less political, like, foundation for everything as a security, because, like, now we have like the top two assets, not a security. Yeah. I wonder if this puts an end to sort of the extreme regulatory headwinds that we've been facing for the last, basically 18 months to two years. Right.

We had Operation Choke point. The anti crypto army. Like, this feels to me like it's, it's more than just Ethereum ETF being approved. As Jake is saying. This is like a shift in DC, and it's basically democratic establishment saying, hey, you know, being anti crypto fight, we.

Don'T want to fight that fight. It's not going to win, like Biden, the presidential election. And so like, we, maybe they lean into, start leaning into being pro crypto. I think there's a marker of that, too, and which, which means we might get the headwinds in our favor for some brief period of time. Right.

Ryan Sean Adams
We've never had that. What we learned from the consensus interview with Joe Lubin and Matt, the lawyer, is, is that there is like a back, back room, like smoke, smoke filled room of people who do not want the ETH, ETF approved because they're trying to suppress Ethereum. They're not concerned with bitcoin because bitcoin doesn't have smart contracts. It doesn't have a banking layer. It doesn't offend the banks, it doesn't offend the Clinton types that want their control.

David Hoffman
These were Joe Lubin's words. And so the political establishment, the Democrats, have shifted the way from like, okay, we understand that our, like, these people don't want the power of Ethereum to be unleashed, but we also want to get reelected. And so this is the re electing emphasis, taking precedent over whatever powers that may be that are pushing behind the scenes for the Gary, for the Gary Gensler Sec to disapprove this body ETF. This is why Gary Gensler was always resistant to saying, is ETH a security or is it not? He would, he would very clearly said that bitcoin is not a security.

He very clearly was extremely ambiguous around ETH as a security or commodity because he could not claim that ETH was a security because he wasn't ready for it, but he couldn't claim it was a commodity because they didn't want that. Now, all of that precedent is like being wiped away from them, which is what he, which was the foundation that he was standing on to claim that all tokens are securities. So, like so much of the entire argument, foundation of the SEC is now gone again if the ETF gets approved. David, are you looking at this tweet here? This is Bill Hughes, Elizabeth Warren making phone calls right now.

Ryan Sean Adams
I don't care that he's in a meeting. I want him on the phone now. Anti crypto army in shambles. I want to go back to a Mike Ippolito take. He says this feels like the bottom sentiment in ETH sentiment.

He posted this on May 18, just the backdrop to this, because we didn't talk about it enough. I don't think ETH sentiment to me was at sort of like a cycle low. In the last couple of weeks, months, it's had paltry performance in the bull market. Bitcoin has overperformed. Other alternative layer ones have, like, overperformed.

So Solana has been crushing it. ETH really just like, hasn't kept up. And so the market, the market sentiment is basically like, why buy ETH, right? Like, Solana and these alternative layer ones are lower market cap and, like, are appreciating faster. They have the meme coins, and then you have bitcoin, which has institutional demand.

So ethereum is, like, stuck in this middle. And so this caused not only, like, the anti ETH sentiment on Twitter, but even the bulls are starting to get shaky. This is a talk in the ethereum community about changing the narrative and what do we do and who's defending the narrative. And so this is Mike Ippolito on the 18th saying, this feels like the cycle bottom in ETH sentiment. First time in a long time.

ETH isn't consensus. Yeah, it lost consensus, didn't it? None of the arguments on my timeline feel that meaningful. It's mostly bickering or airing old grievances. ETH will send in a few months when everyone remembers the ETF.

I think the market is about to start remembering the ETF. Yeah, that's current, currently priced in or getting priced in, but also really, like I said, really slowly. The. Okay, ETH is up 11.7% on the one day. Solana is up 9%.

David Hoffman
So, like, ETH is actually only up two and a half percent versus Solana. But also, like, all the long tail of crypto assets should definitely get a boon from this because of the regulatory green light that this is giving the collective industry. So, like, even bitcoin is up 5% on the one day just because, like, this is just bull. This is not just bullish for ETH, this is bullish for the crypto industry. Like, any, anyone with any sort of crypto asset exposure should be very happy about this.

Ryan Sean Adams
Yeah. And so do you recall some of the numbers we went through with the. I feel like some of these numbers slowed with, like, how big the pipe, the capital pipe is from bitcoin, institutional, like, purchasing of bitcoin from all of the RIAs. And, I mean, we're talking about like, trillions of dollars. How big is the bitcoin, um, ETF market right now?

David Hoffman
It's like, I'm actually looking it up right now. Yeah, look that. Look that up because I think we're in the, what are we in the, like, the $30 to $50 billion market cap, something like that. And, like, to catch gold, if I recall. Figure it out.

Ryan Sean Adams
Okay, well, these are just numbers off the top of my head, but it feels like we're in the 30 to 50 billion range in terms of bitcoin ETF, and spend the, like, the most bullish performing ETF in history, I feel like, to catch gold, it was something like 90 billion to catch gold's numbers. And so you sort of wonder what Ethereum will do after this. It's got some narrative headwinds, I think, for institutions. Did you say how many billions? I said 30 to 50.

How wrong was I? 12 billion. Oh, really? Okay. Ahead of myself.

David Hoffman
Interestingly, in the last two weeks, we've been at some sort of market, mill use market, like quiet period, some doldrums, some crabbing in the last 12345 months or so, we are entering second week in a row, this week of inbound ETF, bitcoin flows. And so bitcoin, the actual flows are going into bitcoin once again after being kind of like at equilibrium on pause for like the past two or three months. Okay, so we've got some positive strength there. Can we talk about the institutional narrative for ethereum, David? So I think it's a little bit different than bitcoin.

Ryan Sean Adams
So we've got productive asset. These, these ETF's, to the extent they get approved, they will not be staked ETF's. It will just be plain vanilla ETH, right? But you still have the narrative of this is a positive yield bearing asset. Right.

Once ETH is staked, I think that's important. I think, you know, institutions have talked about tokenization. Ethereum is really the ecosystem that pioneered tokens, tokenization. So you got the blackrock. All those tokens that you know about, all those nfts that you know about, those are on ethereum, right?

Even the Blackrock biddle fund, which is pretty major, which is like, I don't know, up to like 400 million, something like this. Close to half a billion in t bills. That is on Ethereum as well. So that is kind of like complimentary. Uh, so I think you've got the Internet bond narrative, you've got the productive yield bearing asset narrative.

Actually, you know, I'm going to pull this up. Coinbase put. I think those are all great narratives. I think the biggest narrative is the one that Sandy cool from Franklin Templeton was talking to us about, about how Ethereum is a tech platform. So if you want to own real estate in the same way that, like, you're kind of familiar with by owning Facebook shares or owning Twitter shares, Ethereum is that it is a platform for people to build on.

David Hoffman
And the value of ether grows as this open platform gets built. And so, like, Bitcoin is like the digital gold play in digital store of value. But Ethereum is a tech platform, and mapping ether, the asset, into a financial institutions like tech category makes a lot of sense and definitely resonates. That's what she was saying. Yeah, I think that's right.

Ryan Sean Adams
And I think that's a different valuation. Although we would also argue Ethereum, ether has similar monetary properties as bitcoin, of course, and should be and could be viewed as a store of value as well. So I think that's going to be exciting to watch institutions kind of price that in. I guess there is maybe the bear case here that, like, the institutions don't care about Ethereum at all. Right?

It's kind of like the, the opening act. This is what Eric Balcunis has said in the past, like, and this, to be fair, this is the Ethereum futures markets. There is an Ethereum kind of like futures based ETF out there, and its performance has been pretty paltry compared to bitcoin. Yeah. But compared to bitcoin's futures, yes.

David Hoffman
Yeah. Like, I don't expect the ETF's to be bigger than bitcoin, certainly, but the thing is, $1 of capital into an ETH ETF means something like three x more than $1 into a bitcoin ETF because ETH is one third the size of the market cap of bitcoin. And so it just simply moves the market cap more. And that's also just not even controlling for the amount of bitcoin on bitcoin liquidity on centralized exchanges, of which ether has much less liquidity on centralized exchanges because there's a lot of demand to pull ether into defi and pull it away from centralized exchanges. So ether price discovery happens on Coinbase, the ETH ETF price, whenever there's a buyer of the ETH ETF, that buying pressure will go through Coinbase because they're the custodian.

And that will actually move way more than it moved the bitcoin ETF, because there's just simply much less liquidity of ether on Coinbase. And so like $1 of capital into ETH ETF means a lot more. You know what's crazy is the ETH still has a 20% discount. Every single crypto fund right now is looking out how to buy ETH ETH. And I know that because we are thinking about that at bank ventures.

Ryan Sean Adams
We should have already done. We should have already done that. We should get off this live stream and like go buy. So ethy, of course, is the grayscale Ethereum trust, which will become an ETH ETF, which would basically. That gap will just smush.

Yeah. It would automatically become a bitcoin ETF. And like, I think the. Yeah, so the 20, it's a 20% discount. You could still buy ETH.

Like 20% discount. So it's crazy that that exists as well. It's also cool to watch the Coinbase stock price also pump on this news as well. Again, this is probably the. Well, a Coinbase will be the custodian for the ETH ETF, but mainly it's just like the regulatory risk of the industry is like pumping everything.

David Hoffman
Coinbase is up like 12%, 8% on the day. Today. There's a new tweet from James. Okay, cool, you've got it pulled up. So James tweeted this out a few minutes ago, 20 minutes ago.

Quick note, Eric Baltunis and I increased the odds to 75% for the ETH approvals, but that's for the 19th, May 23 deadline. Van Eck. We also need s one approvals. It could be weeks to months before we see s one approvals and therefore a live ETH ETF.

But the actual launch will be later. Do I care? Really? Do I care about that time discrepancy? No, because this is like the cointelegraph intern, like accidentally false flagging, false start ETF.

Like, it doesn't matter. Like once the market has assurances that it will get approved, people will bid. Like, we saw trad hedge funds front running the actual bitcoin ETF launch who don't care about bitcoin. They just like, well, this is bullish. So they're going to buy bitcoin.

A lot. A lot of the bitcoin price appreciation came from outside capital, who are just front running the actual approvals. So this is different than how it happened with the bitcoin ETF. Though, right? Because bitcoin ETF was approved and then basically days later we had open like bitcoin ETF's that you could purchase.

Ryan Sean Adams
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I'm sending you another tweet. You need to open up this tweet. I'm sending it to you in the dock. I'm highlighting it. Tier ten k.

This is bullish. This is bullish. I love all the bullish stuff. All right, tier ten k. SEC asks exchanges to update.

What?

Yes, Eric, you got to pump those numbers up, baby. Whoa, whoa. 75% is bearish. Let's look at the price here. There we go.

We got another green candle. 3500. We're seeing it. Thanks to Kraken for the charts. He's cracking for the charts.

I knew you guys would make him go green. Oh, man, that is huge. So the SEC asks exchanges to update 19 b filings before filings on accelerated basis for spot ether ETF's. Do you fully know what this means? Why they got a phone call from Daddy Biden?

Ryan Sean Adams
Why did they call sooner, dude? Because 1200 likes on a four minute old tweet. That's great. Well, let me, let me send that one. Did you send it?

Do your part. Do your part, David. Oh, I'll retweet that. I think being noisy on Twitter actually helps. Let's take from, you know, political lobbyists who I've been talking to over the weekend to just like, see what's going on in, in DC.

They were basically like, look, political DC. They live on Twitter. They're just, you know, you're addicted. You think you're crypto native and you're addicted to, like, Twitter or whatever the social, they're like, so are they, because that's where media is like kind of born. So they actually hear us on, on Twitter.

It's a way of influencing the platform. And so I think they are very much paying attention to. And I guess I would say, you know how it feels that, um, we have been so powerless the last two, three years in. In political, like, crypto. Like, the politicians aren't listening to us.

I. This is the first time I've really felt like our voice has actually carried weight in DC, and we are, like, maxing that. So you're retweeting the stuff that you're doing, going to in person political events and asking politicians on stage, just being like, what's your crypto policy? Did you support sab 121 repeal? Like, if not, why?

All the while knowing whether this is supported or not, right? And, like, record that post on Twitter. That's how we amplify and make our voice. Voice heard. And I think it's working.

David Hoffman
Can you open up the. The other tweet that I posted in our doc? This is the ETH price. ETH prices up. Is it closing?

It's closing, yeah, it's up 24% in the last day today. Wow. But it's. It's closing, but it's still, like.

I can't. This is like paint paywalling me, but it still looks like maybe 20% premium to have. Although whether this is a. Yeah. Question.

I don't know what the discount is. What the discount is, man. Okay. Somebody in the bank or daily great discord knows what the discount is. Let me know.

Ryan Sean Adams
This is crazy. This is awesome. This is awesome. I don't. That's a great William piece for meme.

David Hoffman
I don't get it, but sure.

It does look like him. You want to do some ta? Want to open up the TA charts? Yeah, of course. On days like this.

Ryan Sean Adams
I do only days like this, though. This is not my ta, nor is it Ryan's Ta. This is a person who does ta that. Ryan and I both right here. What is this?

What are these lines? So this is. This is the. These lines are monthly and yearly resistances. And then this is the ETH Giga candle that we're currently watching.

This is Ethan dollars. Ethan dollars, which is. This is missing $100 off of the candle because the screenshot is, like, 15 minutes old because we were still pumping. So we're breaking. We've broken through two monthly resistances.

David Hoffman
There was this big descending triangle, which, like, everyone who I know who does Ta on ETH was like, this looks like shit. This looks like shit. This looks like shit. Oh, no. Sell, sell, sell.

Ryan Sean Adams
Oh, it's going down. Sentiment is like, so dog shit. Like descending wedge. Like, it's bad.

David Hoffman
The chart looks like dog shit. And then we get this news and we just like blast through it. And so we are somewhere between the last monthly resistance, the second of the two monthly resistances that's been like highlighted here, we're somewhere between that and the yearly resistance. Like what's it gonna take to get to yearly? 3600 or 3700?

Fuck yearly, dude. Like the, if the f gets approved, like the east price should be multiples of its all time high because the price is going to be so sensitive to outside capital. Like, yeah, like look, look beyond five k in the first half of this year. Well, no, the ETH actually has to get approved once, once the ETH ETF gets approved and then it's live and like there's bids coming in. Like we're looking at beyond five k.

Ryan Sean Adams
Yeah, I think people don't realize, like people don't realize how Una centered the institutional world has been on crypto. It's just basically just bitcoin. Everything else has some regulatory, like, haze over it. And once the ethereum ETF approval happens, then you've got a second asset in there. I think it'll be a while before there's a third crypto ETF or a fourth crypto ETF or a fifth crypto.

David Hoffman
ETF evaluated on its, on its merits. And so like, just because the big, the big brother and yeah, the two big brother coins get, get approved doesn't mean like all the long tail gets approved, right? And you have to appetite for them. But like each one has to go through its own hurdles, starting with a futures et futures that's gonna have. Right.

Ryan Sean Adams
So an Ethereum got that what, back in was it like sometime in fall of last year, I believe something like this, right? Over a year ago. Right. So it takes about a year. You have to get like a futures ETF and then it has to go through the gauntlet.

So chances are it's going to be bitcoin and ethereum as sort of the ets for this cycle. Now I will say that doesn't mean down market doesn't benefit. I totally, and we're seeing it already today. Down market crypto assets that don't have ETF's are going to benefit as well. Like Solana will pump all of these other like, chains and crypto assets will pump as well because it's not that hard to go find your way to the Kraken exchange and go purchase a darn down market.

You can't do it in your 401k, but you certainly can in a us based crypto exchange. So everything will benefit from this. But disproportionately, bitcoin and ethereum will have the institutional flows. Yeah. Being able to buy it, the bitcoin ta, too, because, like, this is just like concerning the entire market.

David Hoffman
Like, the McDonald's ads. It's so funny, dude. We don't need McDonald's anymore, man. We're going to ten k. We need.

To walk on our Chipotle back. Okay. The descending channel, which is what we're looking at, which apparently is what this called. We're breaking through that too. And so this could be the start of a new phase in the market.

Well, actually it probably is unless, like, May 23 happens and this is all a fluke and we get denied. Which 25% chance entertaining that idea. Let's go look. Let's go look. I mean, that was last week's idea.

Ryan Sean Adams
Let's. Let's go see what poly market says. 66% chance with, with that new news. Because, like, okay, so the Bloomberg boys updated it to 75% with the words that they've been hearing. But then that new tier ten k tweet came out saying the SEC has asked exchanges on an accelerated timeline.

David Hoffman
So to me, that's like, 75% is now low because that, that's new information. Unless that is the information, but I think that's new. Let me just entertain this for a second. This is a ready for. This is an Ethereum ETF Bull episode.

Ryan Sean Adams
Okay. What happens if after all of this, it gets denied? Not only gets denied, but Gensler comes out and says ethereum's a security resume. The previous course that we were on.

That would also be crypto, so. Yeah, I know, but, like, that, that would also be something that could happen in this crazy universe that we're in. Yeah. I mean, all possibilities are possible, I guess. Yeah, I don't want to entertain that, though, right now.

Like, I feel like things are moving in our favor for sure. Okay, so, yeah, like, I think that this, this does unlock, again, aside from the very bearish scenario that Ryan, for some reason, just decided to articulate, this is a new phase of the, of the market. Like, we were all, like, the last two, three months of, like, flat, like, grinding. Like, everyone being unhappy for some reason. Like, that's over.

David Hoffman
Like, we are. We're entering a new phase of the market of positive sentiment. Yeah. And I think we'll have that until the election, basically. I think that politicians are now in a mood to do us favors until the votes are counted in November.

It turns out the crypto bros are actually, like, a force to reckon with. And we want. They kind of want. They want money. They want votes.

Ryan Sean Adams
There's no benefit to them being anti crypto. I think the. We've broken the back of the anti crypto army, at least until after November. Okay. This is not.

We have not defeated the final boss. They're going to come back. Once the votes and money don't matter so much in their camp, in their campaigns, they're going to be back. But until then, I think we have momentum on our side. And if the Ethereum ETF passes, it's because of political pressure on the SEC and Gary Gensler.

That's why. Which came from us. That was us. Why there's political pressure. Start with Biden.

David Hoffman
It started with the crypto community pressuring the Biden administration, who pressured Gary Gensler. That was us. We did that as a community. So, like, that's right. That, like, this is what we can do when we have collective action towards a shared goal.

Yes. Don't be nihilist about your ability to influence politics. I hope this shakes people out of our bags. That's right. I hope this shakes people out of this helplessness, like, feeling that you feel with respect to politics.

Ryan Sean Adams
I was listening to a podcast this morning that it was basically like, percentage of us population that are millennials is like 25%. Baby boomers are 20%. Like, we outnumbered them. Yeah. Ensure, like, voting blocks.

David Hoffman
We're bigger than them. It's stupid. Like, why, like, why don't we let our voice be heard, let the issues we care about. As you mentioned earlier, this skew is very much like old versus young in terms of Congress. Like, congressional representatives who were, you know, Gen X and younger voted overwhelmingly regardless, Republican or Democrat.

Ryan Sean Adams
They voted overwhelmingly in favor of the SAB 121 repeal. They'll continue to vote with us. Speaking of the SAB 121 repeal, I think Biden has seven days to veto that. Well, he had ten days when it was approved, so I guess, like, Thursday of last week. Yeah.

David Hoffman
So it's going to be, like, up to. Up to Monday of this week? Of next week. Yeah, but, like, if. If this is indeed the calculus of the Biden administration saying we need.

He has to. He. Why wouldn't he just veto it? Well, I don't know. He could still.

Ryan Sean Adams
He could still. So he might be horse trading here. I'm gonna. I'm gonna veto your sab thing, but I'm gonna give you the Ethereum ETF, right. It's a possibility.

Or he could go full send and be like, I'm not letting Trump. I was wrong. I'm vetoing it. Like, yeah, if he's actually doing it for. To make sure I'm not vetoing it.

We want him not to. Yeah, yeah, yeah, yeah. Like, if that is indeed the calculus, wouldn't we see him not veto the SAP 121? I mean, a full democratic party, like all in White House and everything, like anti crypto army is just kind of eliminated. Would mean we get no veto on the SAB 121, which would be.

David Hoffman
But it would be no veto. Like the Biden administration would say, hey, I'm not going to veto this. Yes. You won't say, I'm sorry, but it's something like that. You have to, you have to interpret that piece of it if you want.

Ryan Sean Adams
And it will also be Ethereum ETF approval, full send. So that would happen. And he'd be like, yeah, our appointee Gary Gensler is approving the Ethereum ETF. Right. And Gary Gensler would be like, I always want.

I was always going to improve this. This is a part of the process. This is just, yeah, you just had. To come in and register and now you checked all my boxes. Of course I was going to approve this all the time.

That's what he'll say. And then, which will be great. And then it would also, there would also be some strong approval. Maybe it won't pass like, Congress and get like, you know, approved through Biden's desk. But this fit act that Patrick McHenry was talking about.

David Hoffman
Right. We would see some strong support on that, whether or not it's approved. And the fit act, like, you can find more about that in the episode that we're like, we're putting out tomorrow, but is basically you puts the, defines the difference between a security and commodity. And basically, SEC has securities, CFTC has commodities. And by the way, in this bill, ethereum is very much.

Ethereum. Decentralized enough. Yeah. To be a commodity in this bill. So it would also take care of this.

Ryan Sean Adams
So you'd see thumbs up on that as well. Totally. Okay, so we recorded that episode with Patrick McHenry this morning, and that'll probably come out today or tomorrow. So stay tuned for that. We're gonna get the ETF boys on the show as soon as we.

Are they responding to our DM's yet? Not yet. Like, they need to go and do their jobs at Bloomberg. They're done doing their jobs at Bloomberg. We're gonna get them on the show.

David Hoffman
So also, stay tuned for that. So if you're watching the live stream right now, make sure you're actually subscribed to bankless so you can see those interviews when they come out. One will be coming out in the next 24 hours. We're gonna get the ETF boys on this show as soon as possible. So just like, the live stream because we're bullish and we're feeling good.

Subscribe to bank list so you guys can get those videos. And, like, just, like, stay tuned for all the ETF news because this is now an ETH ETF media company. Wow. Yeah. At least until May 23, when Gary Gensler eats crow and improves the Ethereum.

Ryan Sean Adams
Not 100%, 75% chances for that, but, yeah. Very exciting. One last tweet. I do want to shout out Anthony Cesano, who relentlessly never blinked and has always said that the ETH ETF will get approved on May 23. And so he's currently on a Twitter break just because, you know, everyone needs to take a.

David Hoffman
Take a step back. But, like, I can't wait for him to come back and just, like, take a victory lap around all of crypto Twitter and everyone. Like, I'm usually kind of resistant to Anthony versus on a victory laughs, but this one is, like, the most deserved laugh that I will have ever seen Anthony take. So, yeah, especially in a mental health break. Mental health break.

Yeah. So, like, not trying to jinx anything here. Like, it still has to get approved. Like, we still don't know what's going on. We only have limited information here, but, you know, things.

The tide is turning. There you go. The tide is turned, guys. We'll keep you updated. You will know what we know as soon as we know it.

Ryan Sean Adams
I hope you enjoyed this bankless livestream edition. Oh, man. I'm gonna. It's been a while since we've done a live stream, an emergency live stream. We're gonna party hard on Thursday if this happens, my guys.

See you later. Odds of David Hoffman beating his fight with Nick Carter also, last thing, let's. Just check the poly market for that. Where's polymarket? For some reason, that polymarket is not looking good.

David Hoffman
David is very, very undervalued by the market. Oh, down bad, David. Down bad. Yeah, man. This is some market manipulation.

Ryan Sean Adams
I think this can't be true. All right, guys, we'll see you later.