Ether ETF Approval Hinges on Issuers' Response Speed, Says SEC Chairman
Summary:
U.S approval for Ether exchange-traded funds (ETFs) depends on how swiftly issuers can react to feedback from the Securities and Exchange Commission (SEC), according to chairman Gary Gensler. Despite SEC's approval of eight filings for spot Ether ETFs on various U.S exchanges, they can't commence trading until they secure requisite S-1 registration statement approvals. It's hinted that Grayscale's successful Bitcoin ETF legal challenge influenced the Ethereum ETF decision. Bloomberg ETF analyst suggests the SEC's reversal on Ether ETFs could be due to SEC Commissioner Jamie Lizárraga, who has ties with Democratic Party member, Nancy Pelosi.
The green light for United States-based Ether (ETH) exchange-traded funds (ETF) is contingent on the alacrity of issuers in reacting to notes from the Securities and Exchange Commission (SEC), asserts chairman Gary Gensler. The burden of gaining approval seems to rest with the issuers according to Gensler, squashing concerns about the SEC prolonging the process.
As of May 23, the SEC gave its nod to eight 19b-4 filings for the listing of spot Ether ETFs on assorted U.S states' exchanges, though they can only commence trade once they obtain the obligatory S-1 registration statement approvals. Gensler, as quoted in a Reuters report dated June 6, stated that the promptness of registrants in reaction to feedback received is entirely within their control. His statements offer fresh insights contrasting his words from a day before on CNBC, where he implied the subsequent steps would be time-consuming, leading some to presume the SEC would deliberate at length before endorsing the S-1 forms.
According to Bloomberg ETF analyst Eric Balchunas, this process could last anywhere from several weeks to months, although his primary prediction is the first week of July. The legal challenge against Grayscale's Bitcoin ETF last year seems to have swayed the decision on Ethereum's ETF, despite the SEC's silence regarding the radical alteration of their stance on spot Ether ETFs right before the inaugural decision deadline.
Grayscale triumphed in their argument in court stating that the sanctioning of Bitcoin (BTC) futures ETFs by the SEC should logically lead to the approval of spot Bitcoin ETFs - a ruling that proved pivotal for their approval. Gensler, conversing with Reuters, noted that Ethereum's case mirrors this, with the SEC staff studying the Ether filings and correlations and finding them quite akin to those in the bitcoin domain.
However, a different hypothesis is offered by Bloomberg ETF analyst James Seyffart, who was taken aback by the approval after months of predicting its unlikelihood – he proposes that SEC Commissioner Jamie Lizárraga, who has prior connections with influential Democratic Party member, Nancy Pelosi, played a role in the sudden change of attitude towards Ether ETFs. In a Bits+Bips podcast with Unchained, Seyffart and others conjectured that Lizarraga, Pelosi's long-time aide, may have had an impact.
On related news, Pelosi backed the crypto-inclusive Financial Innovation and Technology for the 21st Century Act (FIT21) bill, which was passed by the U.S. House of Representatives on May 22, creating a significant benchmark for crypto – and now, crypto voters are reportedly causing disruptions in the 2024 election build-up with a promise of more to follow.
Published At
6/7/2024 4:15:33 AM
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