- The U.S. Securities and Exchange Commission (SEC) has approved multiple spot Ethereum ETFs, including those from BlackRock, Fidelity, and Grayscale.
- This approval marks a significant shift in crypto investment options, following the recent approval of spot Bitcoin ETFs.
- “This is a positive development for investment products in the digital assets space in the U.S.,” said James Seyffart of Bloomberg.
SEC’s approval of multiple spot Ethereum ETFs signals a major shift in crypto investment options, expanding market accessibility and potential institutional funding.
Spot Ethereum ETFs Approval Process
The SEC has approved the 19b-4 filings from VanEck, BlackRock, Fidelity, Grayscale, Templeton, ARK 21Shares, Invesco Galaxy, and Bitwise. These approvals were granted on May 23, 2024, marking a significant change in the SEC’s stance on Ethereum ETFs.
This decision was unexpected due to the SEC’s previous inactivity in engaging with issuers, raising questions about the approval process. Notably, applications from some firms were not included in the approved list.
These ETFs are slated to be hosted on three national exchanges: CBOE, NYSE ARCA, and NASDAQ, thus increasing Ethereum’s availability to a broader pool of investors.
Despite the approval of the 19b-4 forms, trading cannot begin until issuers receive approval for their S-1 registration statements. According to James Seyffart of Bloomberg, this process could take a few weeks to several months.
House Lawmakers Push For Ethereum ETF
Political pressure may have played a role in the approval of these Ethereum ETFs. Earlier in the day, a bipartisan group of House lawmakers, including Majority Whip Tom Emmer and NJ Democrat Josh Gottheimer, urged the SEC to approve the ETFs through a letter.
They argued that the approval of such products would align with the SEC’s standards, following the approval of spot Bitcoin ETFs earlier this year. This political pressure is considered one of the possible reasons for the SEC’s quick approval.
What are the Next Steps
According to market experts like Bloomberg’s Eric Balchunas, Ethereum ETFs could attract between 10-15% of the assets that Bitcoin ETFs are expected to garner, estimated at $5-$8 billion in the first few years. Although this projection is less ambitious compared to Bitcoin ETFs, it is still significant for a new investment product.
Concurrently, QCP Capital has provided a bullish forecast on Ethereum’s value following the ETF approval, expecting Ethereum to rise beyond $6000. This optimism is based on the prospects of institutional funding and increased market accessibility.
Following the approval of the 19b-4 filings, issuers are now focused on obtaining approval for their S-1 registration statements. This step is critical for the ETFs to begin trading. The SEC has already initiated conversations with issuers regarding their forms, but the timeline for approval remains uncertain.
Conclusion
The SEC’s approval of multiple spot Ethereum ETFs marks a pivotal moment in the crypto investment landscape. With increased market accessibility and potential institutional funding, the future looks promising for Ethereum. However, the next steps, including the approval of S-1 registration statements, will be crucial in determining the actual impact of these ETFs on the market.
