Market expectations for the Ethereum spot ETF quickly heated up after the U.S. Bitcoin spot ETF was approved. Bloomberg ETF analyst Eric Balchunas predicted at the beginning of the month that there is a 70% probability that the SEC will approve the ETF in May. However, the latest news shows that the SEC is currently leaning toward "forcibly rejecting" the application, according to Fox Business reporter Eleanor Terrett, citing people familiar with the matter. The news sparked concern and concern in the market, with investors becoming more uncertain about the prospects for approval of the Ethereum spot ETF.
SEC Chairman Gary Gensler has maintained his usual cautious attitude towards Ethereum ETFs. When asked about the matter during yesterday’s media briefing, he emphasized his previously stated position that the SEC’s review of Bitcoin ETFs is limited to this “non-security commodity” and should not be interpreted as a review of Bitcoin ETFs. Where other cryptocurrencies stand.
Two weeks ago (12th), Gensler once again emphasized in an interview with CNBC that the SEC’s decision to pass the Bitcoin spot ETF is based on the understanding that Bitcoin is regarded as a “non-security commodity token.” This means that Bitcoin, like other commodities such as gold and silver, can be included in the scope of spot ETFs. In fact, the SEC has approved spot ETFs for gold and silver in the past, so the endorsement of Bitcoin is a continuation of its previous stance.
Although the SEC has approved an Ethereum futures ETF, they have not made a clear conclusion on whether Ethereum is a security, which may be a reason to refuse to approve an Ethereum spot ETF.
SEC Delays BlackRock Ethereum Spot ETF
There are currently 7 Ethereum spot ETF applications waiting for SEC approval. Applicants include BlackRock and Fidelity ), Grayscale, VanEck, Ark/21Shares, Invesco/Galaxy and Hashdex.
According to the latest news, the SEC has extended the review period for BlackRock’s application by another 45 days to March 10. Additionally, the SEC postponed Fidelity’s filing until March 5. Bloomberg analyst James Seyffart predicts that Ethereum spot ETF delays will occur sporadically over the next few months, with one important date to watch being May 23.
Optimistic view on Ethereum spot ETF
However, this still does not affect the optimistic voice in the market that the product will be approved within the year. Some people point out that it will be similar to Bitcoin spot There are similarities in how ETFs are approved.
Matt Kunke, a research analyst at cryptocurrency market maker GSR, said yesterday (24th): We expect the Ethereum spot ETF to be approved in May, with an estimated probability of 75%. This optimistic outlook is based on Grayscale’s victory in the Court of Appeal and subsequent approval of an Ethereum futures ETF, which all indicate that the approval of an Ethereum spot ETF is only a matter of time.
Kunke added that if the SEC rejects the current Ethereum spot ETF application in May, appeals will be inevitable. If that happens, he believes the SEC will choose the path of least resistance to approve these products while maintaining a skeptical stance toward other cryptocurrencies.
SEC Commissioner Hester Peirce, who has been dubbed "Crypto Mom" by the community, also holds the same view. In an interview with Coinage on Tuesday, she also cited last year's Grayscale ruling on GBTC's transformation into a Bitcoin spot ETF as an example. , said that the Ethereum spot ETF does not need to go through court proceedings to be approved.
Pessimistic View on Ethereum Spot ETF
On the other hand, some analysts are skeptical that an Ethereum spot ETF will be launched anytime soon, given the SEC’s overall stance on crypto ETFs. .
Sky Bridge Capital founder and managing partner Anthony Scaramucci said: We are not optimistic about the possibility of Ethereum ETF being approved within this year. The SEC made it clear in its Bitcoin Spot ETF approval that it considers the vast majority of crypto-assets to be investment contracts subject to securities laws and therefore excludes them from the ETP structure of non-security commodities.
Mark Yusko, founder and CEO of Morgan Creek Capital, who was once optimistic about Bitcoin spot ETFs, also holds the same view. In an interview with Cointelegraph on the 18th, he said: I might say, The chance of Ethereum spot ETF being approved by the SEC for listing in 2024 is less than 50%.
Mark Yusko explained that, as Gary Gensler hinted, even if they passed the application for a Bitcoin spot ETF, the SEC still has a bias against cryptocurrencies. He also pointed out that the SEC currently only regards Bitcoin as a "commodity" with the ability to store value, while Ethereum may be regarded as a security, which has become a major obstacle to the failure of the Ethereum ETF to be approved.
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