Diverging Visions and the Path that Lies Ahead

Fox Business News journalist Eleanor Terrett recently provided insights into the varied perspectives surrounding the potential approval of an Ethereum (ETH) Exchange-Traded Fund (ETF).

Diverging Visions and the Path that Lies Ahead

Terrett’s reporting on the approval process timeline reflects a spectrum of opinions from ETF issuers, investment management firms, and sources close to the US Securities and Exchange Commission (SEC). According to Terrett, an issuer of a Bitcoin Spot ETF, currently with an Ethereum Spot ETF application, expresses confidence. They believe that the successful approval and launch of Bitcoin spot ETFs will create a conducive environment for the SEC to approve Ethereum spot ETFs.

Conversely, an alternative source suggests a “hard no” from the SEC at present, pointing to internal resistance within the SEC regarding the approval of Ethereum spot ETFs. Another source highlights the listing of Ethereum futures ETFs and BlackRock Inc’s successful history with ETF approvals as factors that could prompt the SEC to greenlight the product. This source anticipates the introduction of Ethereum spot ETFs by the end of the summer.

The uncertainty surrounding SEC Chairman Gary Gensler’s stance on Ethereum’s potential status as a security adds a layer of complexity. However, some believe that the classification of ETH as a commodity by the Commodity Futures Trading Commission (CFTC) and Ripple’s legal victory with XRP might make it challenging for Gensler to label most digital assets as securities.

Presently, seven ETH spot ETF applications are awaiting SEC review, with VanEck at the forefront, followed by BlackRock. The impending deadline for VanEck’s application in May 2024 has heightened market expectations for approval.

Despite potential liquidity concerns posing an obstacle to spot ETH approval, the market remains optimistic, drawing parallels with Bitcoin’s successful navigation through similar challenges. The transition of Ethereum to proof-of-stake has affected its supply, but the prevailing sentiment is that this represents more of an outside chance than a hindrance.