Increased Likelihood of Cardano (ADA) Spot ETF Approval
The potential for a Cardano (ADA) spot exchange-traded fund (ETF) to gain approval has significantly increased, as investors keenly anticipate the Securities and Exchange Commission’s (SEC) decision.
Rising Confidence in 2025 Approval
According to Polymarket, a well-regarded betting platform, market-derived probabilities for a 2025 approval have climbed to 64%, reflecting a remarkable 54% rise in investor optimism from earlier this year.
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This heightened confidence is largely attributed to the approaching key deadline of May 29, when the SEC is expected to approve, deny, or extend its decision regarding Grayscale’s proposed Cardano ETF.
Fluctuating Approval Odds
Throughout the first and early second quarters, the odds of ADA ETF approval experienced fluctuations. However, recent developments, such as the appointment of the crypto-supportive Paul Atkins as the SEC chair, have bolstered investor confidence.
SEC’s Extended Decision Timeline
On February 24, the SEC officially acknowledged NYSE Arca’s proposal to list and trade shares of the Grayscale Cardano Trust, thus initiating the formal regulatory review process. This triggered a standard 45-day extension, setting the new decision deadline for May 29.
While such extensions are commonplace, the market’s optimism for approval seems to be gaining traction.
Currently, the SEC has 72 crypto-related ETF applications under review, including two specific to Cardano: the Grayscale Cardano Trust and the leveraged Tuttle Capital 2X Cardano ETF. Approval of these ETFs could represent an important milestone for ADA, potentially increasing institutional adoption and enhancing the asset’s credibility.
Momentum Amidst Controversy
Despite controversies surrounding Cardano’s founder, Charles Hoskinson, momentum for the ADA ETF continues to build. On May 7, NFT artist Masato Alexander accused Hoskinson of exploiting the 2021 Allegra hard fork to transfer 318 million ADA from unclaimed 2017 ICO tokens, with only $7 million supposedly reaching the governance group Intersect.
Hoskinson has refuted these claims, stating they are false and asserting that more than 99.8% of ICO tokens were redeemed correctly.
ADA Price Trends and Market Sentiment
As of the latest data, ADA is trading at $0.73, experiencing a 0.5% decline over the day and a more significant drop of over 7% over the week.
Despite the current bearish trend, ADA remains above its 50-day and 200-day moving averages, suggesting a generally optimistic long-term outlook. The 14-day Relative Strength Index (RSI) reads 50.45, indicating neutral momentum. Meanwhile, the market sentiment is also neutral, with a Fear & Greed Index score of 71, reflecting an underlying sense of greed.
