Further tensions have risen in the broader digital currency ecosystem this week ahead of a decision on a potential spot Ethereum ETF. In the latest update, the U.S. Securities and Exchange Commission (SEC) published documents inviting public comment on parts of a future spot Ethereum ETF application.
Spot Ethereum ETF: First Official Comment from the SEC
The market regulator has been cautiously communicating with prospective spot Ethereum ETF issuers. But after approval became more likely earlier this week, the market regulator made its first major filing in anticipation of approval. In separate filings featuring BlackRock, Grayscale Investments, Ark21Shares, Fidelity Investments and Bitwise, the regulator requested that comments be submitted electronically or on paper.
In the filing, the market regulator highlighted key aspects of the spot ETH ETF application, including safety of investors' assets, compliance with securities regulations, redemption measures, etc. According to his analysis, the regulator's stance on the spot Ethereum ETF product has become mostly dovish.
“The exchange believes this proposal was designed specifically to protect investors and the public interest. Investor protection issues for U.S. investors include the roll costs of Ethereum futures ETFs and the OTC Ethereum “It has expanded significantly in recent years through the fund's premium/discount fluctuations and management fees,” the filing states.
This request for comment suggests that regulators are likely to approve the product in line with prevailing market expectations.
The fate of VanEck and Ark 21Shares applications
There are a number of developments related to spot Ethereum ETF approval that analysts have identified. VanEck and his two companies, Ark 21Shares, expect a decision on the application this week. Market analysts speculate that the 19b-4 could be approved while the parties take time to adjust the Form S-1.
There has been further speculation in the market regarding a Spot ETH ETF product. In the case of the Spot Bitcoin ETF, there were weeks of back and forth between regulators and the issuer, which streamlined the process and ultimately led to the approval and launch of the product in the same week.
This time around, analysts said the time between initial 19b-4 approval and an actual launch could take anywhere from a few weeks to a few months.
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