The U.S. Securities and Exchange Commission (SEC) is seeking public input regarding the potential approval of a Spot Ethereum (ETH) ETF, according to an April 2 court filing.
The SEC specifically sought comment regarding Bitwise Ethereum Trust, Fidelity Ethereum Fund, and Grayscale Ethereum.
SEC seeks comment on Ethereum spot approval
The latest court documents say federal officials are considering “soliciting comments on the proposed rule changes” from “interested parties.”
“The proposed rule changes aim to perfect the mechanics of a free and open market. and generally to protect investors and the public interest in facilitating listing and listing.Evaluation of additional types of exchange-traded products that enhance competition between each other and market participants to the benefit of investors and the market,” the court filing states.
What are the chances that a Spot ETH ETF will be approved?
News of the SEC's request for public comment comes on the heels of the SEC's January 2024 approval. Several spot Bitcoin ETFs are a move that many in the cryptocurrency community feel will accelerate mainstream cryptocurrency adoption in the future.
In the months since its approval, the Spot Bitcoin ETF has surpassed the market cap of traditional silver ETFs, with an estimated $862 million in inflows last week.
SEC Chairman Gary Gensler warns the public He said his agency's approval of the Spot Bitcoin ETF “is in no way an indication of the Commission's desire to approve listing standards for crypto-asset securities.”
“Additionally, this approval does not imply anything about the Commission's opinion regarding the status of other crypto assets under federal securities laws or the status of non-compliance with federal securities laws by particular crypto market participants. '' he continued.
You will be tagged in tweets about this application, Eth Corr research, and other Eth ETF hopiums. I respect all that, but the chance of an Ethernet ETF being approved in May is still a pessimistic 25% (I'd like it to be lower if possible). There are 7 weeks left until the deadline and radio silence from the SEC = gloomy. (I repeat… https://t.co/fc8elrYm64
— Eric Balchunas (@EricBalchunas) March 28, 2024
Experts now estimate that the chances of a Spot Ethereum ETF being approved by May have declined sharply over the past few months, with Bloomberg ETF analyst Eric Balchunas calling the odds “pessimistic.” 25%.
A regulatory gap in the SEC?
Under Gensler's leadership, the SEC has long taken an anti-cryptocurrency stance, often taking an enforcement approach to regulation rather than a clear regulatory framework.
At the Institute of Practical Law's SEC speaking event on Tuesday, Gurbir S. Grewal, director of the commission's enforcement division, criticized the cryptocurrency sector's “serious non-compliance” with regulations.
But SEC Commissioner Hester Pierce voiced rare dissent from within the agency about the agency's enforcement methods, going so far as to say the agency was “scaring people.”
It is unclear how this ideological divide within the Fed will play out regarding the potential approval of a Spot ETH ETF.
