- An Ethereum ETF approval may be unlikely in the near future, according to market experts.
- The SEC has demonstrated reluctance towards the proposed investment vehicle.
- The SEC Chair Gary Gensler is keeping the broader market on edge.
Ethereum ETFs have recently become all the buzz across the industry, following the approval of their predecessor, Bitcoin ETFs, by the U.S Securities and Exchange Commission (SEC). Despite the regulator’s history of delays and unpredictability, market predictions initially suggested a probable approval in May 2024 with heightened expectations for the commission to rock a less complicated path and grant approval for the eight hopeful issuers.
However, the intensified optimism may be waning as market analysts chart a less enthusiastic course for the proposed investment vehicle.
SEC Unlikely to Approve ETH ETF?
According to FOX reporter Eleanor Terret on March 10, the likelihood of an Ethereum ETF approval by May 23rd is diminishing.
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Citing familiar sources, Terret emphasized that the ongoing review process for Ethereum ETFs has not seen significant progress, marked by the SEC staff’s lack of enthusiasm to kickstart the process. This contrasts the flurry of actions witnessed with the Bitcoin ETFs, including filing comments, revisions, and frequent meetings among invested parties.
The commission’s lukewarm approach to the engagement with issuers has also sprouted uncertainty for the looming decision. Bloomberg analyst Eric Balchunas asserted that the unraveling of events to date “is not a good sign,” with predictions that the initially anticipated May approval is unlikely if the commission does not initiate dialogue with issuers within the coming month.
The broader institutional support for Ethereum, which is not as robust as compared to Bitcoin, is also reported to be a concern for the commission, observed in the recent tight-lipped approach of SEC Chair Gensler to the question of the fate of the proposals.
Ethereum ETF: SEC Gensler Keeps Mum
In a recent interview with Yahoo Finance, Gensler avoided addressing inquiries regarding ETH ETFs, expressing reluctance to make premature judgments on the proposals currently under review.
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When asked about the issuers seeking to launch the proposed investment vehicle, Gensler simply stated that each proposal will be undergo thorough evaluation.
"I don't want to prejudge anyone filing, and as you said, there are ten filings in front of us," stated the SEC Chair. "So, news alert, I'm not going to prejudge that. But to your question, we look at the facts and circumstances and that which was in front of us.”
The SEC Chair is also reportedly facing backlash from anti-crypto policy makers such as US Senator Elizabeth Warren for the approval of Bitcoin ETFs, further making the commission’s likelihood to follow the precedent uncertain.
On the Flipside
- SEC commissioner Hester Peirce has assured the industry of a fair deliberation process for Ethereum ETFs.
- The inclusion of market giants such as BlackRock in the race for approval continues to drive optimism among investors.
- Currently trading over $4,000, Ethereum has experienced a notable price uptick amid the ongoing Bitcoin-led rally and an ETF approval could further impact its performance positively.
Why This Matters
Predicting a certain verdict for an Ethereum ETF is challenging, especially considering the SEC’s lukewarm approach to the industry. The commission’s approval of Bitcoin ETFs is not sufficient to guarantee a potential greenlight, and additional factors, such as the broader uncertain regulatory standards, will influence the trajectory of the ongoing review.
Read more about the SEC’s unending delays of deadlines for Ether ETF proposals:
SEC Extends ETH ETF Wait with BlackRock and Fidelity Delays
To further understand the success of Bitcoin ETFs so far and the leading players, read here:
