Nate Geraci, President of The ETF Store, has publicly challenged the U.S. Securities and Exchange Commission’s (SEC) anticipated stance on Ethereum (ETH) spot exchange-traded Funds (ETFs).
In a series of statements published on social media, Geraci questioned the logic behind a potential denial, particularly given the SEC’s previous approval of ETH futures ETFs.
“If the SEC denies spot ETH ETFs, what will the rationale be? Lack of correlation between spot and futures market? Then why approve ETH futures ETFs? ETH equals security? Then why approve ETH futures ETFs? Staking? Issuers have (reluctantly) removed. I don’t see a path for legal disapproval here,”
Geraci wrote in a X post on May 15.
The SEC’s decision on whether to approve spot Ethereum ETFs or not is scheduled for May 23, 2024. There have been speculations of a potential denial following the regulators’s recent annoucement outlining the complexities involved in evaluating Bitwise Ethereum Trusts’ proposals to list and trade shares. In particular, the regulator emphasized the need to assess the nature of the underlying assets and ensure compliance with regulatory requirements.
According to Geraci, the speculations of denials are either guesses or the SEC isn’t “engaging.” He further suggested that “Maybe the SEC just doesn’t want a clown show around this like they had with the spot BTC ETF,” alluding to the chaotic proceedings that have characterised past SEC decisions.
Meanwhile, Eric Balchunas, a Bloomberg analyst, has highlighted the substantial regulatory hurdles facing Ethereum ETFs compared to Bitcoin ETFs. He emphasised the centralised role of the Ethereum Foundation, which adds layers of complexity and uncertainty to the SEC’s decision-making process.
Following the launch of spot Ether and Bitcoin ETFs in Hong Kong in April 2024, crypto industry stakeholders have been eagerly anticipating the U.S. securities regulator’s response to the multiple applications submitted by potential issuers.
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- Hong Kong Spot Bitcoin ETFs Struggle to Impress on Debut, Fail to Match U.S. ETFs in Trading Volumes
The SEC, notably after 11 years of multiple denials, approved ten spot Bitcoin ETF products for trading in the U.S. markets earlier this year. The move was highly welcomed by investors, and the country now has the largest market for the financial products globally.
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