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Will Ethereum spot ETFs be approved or not?

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Important facts:
  • “There are no positive signs,” says expert Eric Balchunas.

  • For the Grayscale executive, “They must be approved.”

Ethereum (ETH) cryptocurrency spot ETFs are awaiting approval or rejection by the US SEC.

For some, like ETF experts Bloomberg Intelligence, Eric Balchunas, chance of approval is 25%, In fact, emphasis on this Which is “25% too pessimistic.” In his opinion, “there is no positive indication or information anywhere”. personally He would like it to be approved, but “it doesn’t feel good”.Said.

“The lack of commitment appears to be deliberate, not a delay,” says Balchunas. Regarding this aspect, it is also express Fox Business journalist Eleanor Terrett commented that staff at the United States Securities and Exchange Commission (SEC) did not actually “participate in any meaningful way as they did with the Bitcoin ETF.”

Other experts have joined Balchunas and Terrett’s position, such as Jake Chervinsky, legal director of Variant Fund.

Chervinsky said that, Although he cannot say with certainty that the Ethereum ETF will be rejectedbelieves that “legal and political conditions in Washington DC” make denial more likely than common sentiment, as reported by CryptoNoticias.

The Democratic senators from the US capital are John Francis Reed and LaFonza Butler. made his stance public Against ETFs and met with SEC Chairman Gary Gensler Eliminate any proposed ETF based on any cryptocurrency,

In this regard, Balchunas Said That “the massive success of the Bitcoin ETF is unsettling senior Democrats.”

optimism is not lost

Just as there is pessimism, there is also optimism around the potential approval of ETH-based funds. Craig Salm, legal director of fund manager Grayscale, Thinking Ethereum ETF “must be approved.”

Salm addressed the lack of engagement mentioned by Balchunas, elaborating that in the final months before the approval of the Bitcoin ETF, Grayscale and others received “positive and constructive engagement from the SEC” and had “thoughtful” conversations. and “fine details” were discussed.

He assures that, Just as all the problems with BTC funds were solved, the same should happen with ETH fundsBecause “when comparing Bitcoin spot ETFs to Ether they are identical.”

The only difference, according to Salm, is that instead of the ETF containing bitcoin, it contains ether. “In many ways, the SEC has already engaged and issuers have much less to engage this time.”

Therefore, there is not as much intensity in the negotiations between the parties as before the approval of a Bitcoin ETF. executive connects him Lack of commitment by the regulatory body should not be indicative of one outcome or the other,

“Investors want and deserve access to Ether in the form of a spot ETF and Grayscale believes the case is as strong as it was for a Bitcoin spot ETF. He commented, “We look forward to collaborating with the SEC on these important products.”

Grayscale is one of seven companies that have filed with the SEC for authorization to issue an Ether ETF and has a BTC fund.

Is Ethereum a commodity or security? SEC not defined

The future of Ethereum ETF also They depend on the classification made by the SEC on the crypto asset,

The SEC has not officially declared that Ethereum is considered a commodity. (raw material), As it has done with Bitcoin. However, in October last year, the SEC approved an ETH futures ETF.

On the other hand, officials from the United States Futures Trading Commission (CFTC) have stated that ETH is a commodity.

According to magazine Fortune, SEC has sent summons to several companies related to the investigation About Ethereum. Companies must provide all documents and financial records regarding their transactions with the Ethereum Foundation, the non-profit organization of the Ethereum ecosystem.

In Fortune’s opinion, SEC is considering classifying ETH as a securityA measure that, if implemented, would impact not only ETH but also the rest of the cryptocurrencies.

In any case, the community revolving around Ethereum and crypto assets should wait for an important date. The regulatory agency has the last date till May 23 Give your verdict on the Ethereum ETF proposed by VanEck CompanyWhich is the first of seven that he will have to answer for.

At that time the SEC’s position will actually be known and This will also mark the future in the price of ETH, If they are approved, it could significantly expand the investor base in the cryptocurrency, resulting in an increase in the price of ETH due to the simple law of supply and demand.

The approval of an Ethereum ETF by a regulator like the SEC would also be an important milestone that would bring legitimacy and trust as an investment asset. If they are not approved then the opposite may also happen.

At the moment, the price of ETH against BTC has been falling for several months with no signs of improvement, as can be seen in the following graph. trading view,

The price of ETH is expressed in BTC. Source: TradingView.

The SEC’s decision could define the future of the price of the Ethereum cryptocurrency and lead it to rally against Bitcoin or continue its decline.

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