Crypto News- Last week, America’s largest cryptocurrency exchange, Coinbase, sat down with the Securities and Exchange Commission (SEC) to discuss Grayscale’s proposal for a spot Ethereum (ETH) exchange-traded fund (ETF).
During the meeting, Coinbase, a publicly-listed company, provided insights to the top Wall Street regulator regarding Grayscale’s envisioned product, as revealed in documents filed by the regulator on Wednesday.
Coinbase Consults SEC Regarding Grayscale’s Ethereum ETF Proposal
Grayscale, a crypto fund manager, had initiated the process in October by filing an application with the SEC to transform its Grayscale Ethereum Trust (ETHE) into a spot ETH ETF. This ETF would grant investors direct exposure to Ethereum, the second-largest cryptocurrency, through shares tradable on a stock exchange, thereby mirroring ETH’s price movements.
In its presentation, Coinbase highlighted concerns about potential market manipulation and outlined plans for robust surveillance mechanisms. Notably, Coinbase emphasized a “comprehensive surveillance-sharing agreement with the Chicago Mercantile Exchange” to aid in detecting and preventing fraud and manipulation.
The presentation underscored Ethereum’s resilience to fraud and manipulation, citing the robustness of spot markets and inherent mechanisms within the cryptocurrency that mitigate susceptibility to such risks.
The SEC’s recent approval of 11 spot Bitcoin ETFs in January marked a significant milestone after years of rejections, signaling a shift in regulatory stance. Grayscale, among others, seized this opportunity, converting its Bitcoin Trust into a spot Bitcoin ETF and now pursuing the same for Ethereum.
Industry analysts, including British multinational bank Standard Chartered, anticipate SEC approval for ETH ETFs by May, potentially catalyzing a surge in Ethereum’s value. This optimism aligns with recent market trends, as Ethereum recently breached the $4,000 mark for the first time since 2021, currently hovering around $3,948 according to CoinGecko data.
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