According to a research report from broker Bernstein released on Tuesday, the approval of an exchange-traded fund (ETF) for spot ether (ETH) in the United States could be viewed as significant regulatory relief for the cryptocurrency sector. This approval could also lead to expectations for Ethereum’s competitor, SOL, to be designated as a commodity.

The report, distributed to clients prior to the final deadlines set by the SEC to decide on some of the ETH ETF applications, suggested that the Biden administration might soften its stance on cryptocurrencies ahead of the November Presidential Elections. Additionally, it mentioned that a potential victory for Trump could have broadly positive implications.

Analysts Gautam Chhugani and Mahika Sapra wrote, “Long term, we do believe, should Trump get elected, crypto could see significant legislative and agency support (with a new SEC chair), to usher in long-lasting structural changes in crypto financial integration.”

They added, “More tactically, the approval of the Ethereum ETF would establish the precedent for a non-Bitcoin blockchain asset to be considered a commodity, raising hopes for Ethereum’s counterparts (such as Solana) to follow suit.”

The categorization of cryptocurrencies as either securities or commodities carries extensive implications. For example, the approval of ETF applications is contingent upon the classification of tokens as commodities. Conversely, classification as a security entails stricter regulatory oversight by the SEC.

Earlier in the week, ether experienced a surge after two prominent Bloomberg ETF analysts raised the probability of the SEC approving spot ether ETFs from 25% to 75%. This surge followed reports that the regulator had suddenly requested applicants to update their filings, indicating a higher likelihood of approval. The SEC faces several final deadlines on spot ether ETF applications this week, having previously postponed its decisions multiple times.

Bernstein observed that bitcoin saw a 75% increase in value since the approval of spot ETFs, and it anticipates a similar price movement for ether. The report highlighted that ether’s free float and supply appear more attractive than bitcoin, with 38% of the cryptocurrency locked in staking, smart contracts, and layer 2 chains, and 66% of ETH supply remaining untouched in the past twelve months.

While the filings for the ether spot ETF 19b-4 are expected to be approved this week, S-1 filings are not anticipated to become effective for weeks to months, as indicated by Alex Thorn, head of research at Galaxy Digital (GLXY) in a report on Tuesday. Thorn mentioned that this would result in no exchange-tradable ETH spot vehicles until the summer.

Should the SEC approve the spot ETFs, Galaxy speculates that they could be launched on exchanges in July or August. Galaxy also anticipates that the regulator will approve all applications simultaneously to prevent any individual issuer from gaining an advantage.