Ethereum’s price has barely budged despite the US Securities and Exchange Commission (SEC) giving the green light for spot Ether exchange-traded funds (ETFs) to launch faster in the United States.
Ahead of the SEC’s landmark approval, Ether fell by 3.4%, rebounding by around 5% shortly after. CoinMarketCap reports that Ether’s current price is $3,701, and its 24-hour volume is $47.5 billion.
SEC Meeting on the 23rd of May approved VanEck has received 19b-4 application from the likes of VanEck BlackRock Fidelity Grayscale Franklin Templeton, ARK 21Shares Invesco Gala, Bitwise and Invesco. The approval is crucial because it allows the firms listed to trade Ether ETFs at their exchanges.
Hashdex is the only ETF that failed to receive approval from the regulatory authorities on this day.
However, the journey isn’t over for ETF issuers. Before spot Ether exchange-traded funds can begin trading officially, they must first get the SEC to approve their S-1 filing statements. This may take weeks or even months.
“Typically, the SEC takes several weeks to a few months to review and provide feedback on S-1 registrations. This period involves a detailed examination of the filings to ensure compliance with regulatory requirements. So, in worst case, we are looking to end of summer,” Crypto.news spoke with Georgii verbitskii founder of TYMIO.
The Securities and Exchange Commission’s May 20, 2015 directive to speed up 19b-4 applications caught many people by surprise. This was especially true when staking had been removed from several of the filings. This sudden move has sparked speculation as to the SEC’s motivations.
Industry insiders have suggested that political pressure was a factor. Prior to the approval, a bipartisan group of lawmakers had urged the SEC These ETFs are approved, with the argument that Bitcoin ETFs set a precedent for Ethereum ETFs.
Is ETH no longer considered a security because of the SEC’s ETF approval?
Meanwhile, the approval of Ethereum ETFs is seen by industry experts as a subtle but significant nod from the SEC, implying that Ether is not considered a security.
“These are commodities-based trust shares, so the SEC, by approving these, is explicitly saying they’re not going to go after Ether as a security,” said James Seyffart, analyst at Bloomberg ETF on Bankless Podcast.
Digital asset lawyer Justin Browder concurs, asserting that if Ether ETFs get S-1 approval—the final hurdle for trading—then the “debate is over: ETH is not a security.”
Verbitskii, for example, believes that the SEC may still be targeting ETH.
“The approval of an Ethereum ETF by the SEC does not mean they no longer see Ethereum as a security. It simply means the ETF meets regulatory standards for trading and investor protection (or at least they think so),” Verbitskii sa.
Scott Johnsson, an attorney specializing in finance and securities law, also noted that Ether was not confirmed as a non-security by the SEC’s approval order. “completely sidestepped” The issue.
An official statement from the SEC and some of its Commissioners is anticipated in the near future, which may provide further clarity on this matter.
Four and a quarter months ago, the SEC had approved applications for several Bitcoin spot ETFs on January 10, a first in this industry. Industry experts expressed expectations of further growth following the announcement.
Sumit Gupta is the co-founder and CEO of CoinDCX. He noted that Bitcoin’s price increased significantly in January after its ETF began trading. This suggests that an Ether spot ETF may drive a rise of as much as 60%.
“Bitcoin rose to over $73,000 from $42,000 in the two weeks after the ETF started trading on January 11. Data suggests that 10 US spot Bitcoin ETFs absorbed 548,556 BTC worth $36 billion in four months. Similarly, it is anticipated that a spot Ether (ETH) ETF could drive a rally of as much as 60%,” Gupta said to crypto.news.
Lennix Lai, OKX’s chief commercial officer, highlighted the potential for substantial institutional demand for spot Ethereum ETF, envisioning passive capital inflow from institutional players of around $300-500 million in the first week.
He stressed the importance of this new development and noted that Ethereum’s design as an Proof-of-Stake token (PoS), could attract institutional interest.
“In addition, Ethereum offers more utilities than many realize. It’s the go-to product for participating in DeFi products, such as staking. As such, the approval of the ETH ETF could potentially attract more users to engage with Web3 products,” Lai concluded.
Experts warn, however, that despite Ether’s historic approval the price may not surge immediately.
Asal Alizade, co-founder of Blocklogica, explained that the main market shift occurred with the approval of Bitcoin ETFs, which facilitated the entry of bigger cash flow from traditional investment institutions. Ether ETF approval could not cause a drastic market shift, but rather influence EVMs and minor trends on the crypto market.
Benjamin Charbit, CEO of Darewise Entertainment, added that the ETF approval had likely been priced in for some time, similar to the Bitcoin ETF approval earlier in the year. “I would not see it as a negative sign; on the contrary, it shows a form of maturity similar to what has happened for decades in traditional finance (TradFi),” Charbit.
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Source: crypto.news
