Is the Ethereum spot ETF on hold?

Ritu13

According to media reports, four informed sources revealed that the U.S. Securities and Exchange Commission (SEC) is expected to reject the applications for Ethereum spot ETFs from issuers and other companies.

Previously, VanEck, ARK Investment Management, and seven other issuers submitted applications for Ethereum price-linked ETFs to the SEC, with responses from the SEC expected on May 23rd and May 24th for VanEck and ARK, respectively.

The sources disclosed that recent meetings between the SEC and the issuers were not optimistic, as SEC staff did not discuss execution details regarding the financial product, contrasting sharply with the intensive and detailed discussions seen previously with Bitcoin spot ETFs.

Last October, the SEC approved several Ethereum "futures" ETFs. Sources indicated that issuers believed this decision paved the way for Ethereum "spot" ETFs and expressed determination to address potential regulatory concerns to the SEC.

However, after hearing from the issuers, the SEC did not specify detailed concerns or raise general questions, indicating that the agency is likely to reject these applications. Broadly speaking, the U.S. regulatory body seems reluctant to replicate the example of Bitcoin spot ETFs with other products.

Earlier this month, VanEck CEO Jan van Eck told the media that their application "is likely to be rejected." However, some issuers stated that they still plan to submit more disclosure documents to the SEC to keep the dialogue going.

In fact, current SEC Chairman Gary Gensler has long been a skeptic of cryptocurrencies, and the approval of Bitcoin spot ETFs only came after Grayscale Investments won its lawsuit against the SEC.

Critics argue that if Ethereum spot ETFs are approved, it could pave the way for more speculative cryptocurrency ETFs, exposing investors to risks beyond their expectations.

Todd Rosenbluth, ETF analysis director at data firm VettaFi, commented, "The regulatory outlook remains cloudy, and at this point, the SEC seems more likely to delay approval until later in 2024 or longer."

Analyst Eric Balchunas believes the probability of approving Ethereum spot ETFs by the end of May is only 25%, down from his previous prediction of 70%. The forecast from prediction market Polymarket is even more pessimistic, giving odds of only 11%.

Pooja193

Sometimes it's better not to jump to conclusions too quickly.

Kalkin995

It feels like this one won't be easy to pull off.

Indra55

This one will definitely happen.