According to Cointelegraph, Bloomberg ETF analyst James Seyffart pointed out in a CryptoQuant private webinar that the SEC had tacitly approved Ethereum as a commodity when it approved the Ethereum futures ETF last year. This means that there may be an Ethereum spot ETF listed this year.
The first batch of Ethereum futures ETFs in the United States were approved for listing in October last year. Nine Ethereum-related futures ETFs from Valkyrie, ProShares, VanEck, Bitwise, Kelly, Volshares and other fund companies were listed on the Chicago Board Options Exchange. Online, James Seyffart pointed out that the SEC did not question Ethereum’s classification at the time: the CFTC blatantly called Ethereum a commodity, not a security, and the SEC approved an Ethereum futures ETF. Therefore, Gary Gensler will not explicitly state whether Ethereum is a security or a commodity, but through the SEC’s action in approving those Ethereum futures ETFs, the SEC implicitly accepts that those Ethereum futures are commodity futures.
There are differences in legal requirements, taxes and regulatory burdens between securities and commodity ETFs. Therefore, it is very important to classify them correctly. James Seyffart believes the SEC may not be able to challenge Ethereum’s classification. If the SEC treats Ethereum as a security, they could face lawsuits and have to delist the Ethereum Futures ETF. However, the specific situation may be affected by more factors and requires further observation.
James Seyffart believes that if the SEC treats Ethereum as a security, it will confront the entire cryptocurrency industry and at the same time go against the sister regulator CFTC. Therefore, he believes that an Ethereum spot ETF may be approved this year.
The SEC recently lost a similar lawsuit. In 2020, the SEC excluded the SPIKES Index from the definition of "security futures" and classified it as "futures." However, in July last year, the court overturned the SEC's decision, finding that the SEC's order was arbitrary and capricious.
Last year, seven institutions including BlackRock submitted applications for Ethereum spot ETF to the U.S. Securities and Exchange Commission (SEC). Currently, the SEC’s deadline for final approval of VanEck, ARK21Shares and Hashdex’s Ethereum spot ETF applications is set for May 2024. Other applications will be approved in the coming months.
However, before that can happen, the SEC must decide whether to approve a Bitcoin spot ETF. Currently, the market is nervously awaiting whether the SEC will approve the listing of a Bitcoin spot ETF before the January 10 deadline. According to a Fox News report yesterday, there is news that the SEC may make an approval decision as soon as this Friday. If approved, trading will officially begin next week. The market is full of expectations for the outcome of this decision.
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