As the US Securities and Exchange Commission (SEC) progresses towards potential approval of exchange-traded funds (ETFs) linked to the current price of Ethereum, there is a potential shift on the horizon for cryptocurrency investors. The final decision announcement date for approval is anticipated to be revealed on July 4, 2024.
Various ETF issuers, including notable industry players like BlackRock, VanEck, Franklin Templeton, and Grayscale Investments, are racing to secure approval from the SEC. The introduction of Bitcoin spot ETFs earlier this year showcased the success and market acceptance of these products, ushering in a new era following extensive negotiations with regulators.
Insiders from two of the involved companies have disclosed that the process is in its concluding stages, currently addressing only minor matters. A legal expert closely monitoring the proceedings noted, “We are in the final stages of resolving the remaining details.”
The triumphant performance of Bitcoin spot ETFs is noteworthy, initially amassing approximately $8 billion in assets, a figure that subsequently surged to nearly $38 billion. However, the transition of the Grayscale Bitcoin Trust to an ETF resulted in a significant decline in assets, plummeting from $27 billion to $17.8 billion.
SEC President Gary Gensler has signaled that the progression of Ethereum ETFs is advancing smoothly. Conversely, analysts like Bloomberg’s Eric Balchunas anticipate the ETFs to debut in early July, although Gensler hints at a possible delay in listing until September 2024.
In recent developments, VanEck has taken a step forward by submitting a Form 8-A for its Ethereum ETF, indicating that a listing may be imminent. Last month, the SEC greenlit Forms 19b-4 for eight Ethereum ETFs, leaving the companies on standby solely for the activation of their registration statements (S-1s) before trading commences.
Despite optimistic projections, James Butterfill of Coinshares issues a cautionary statement: “While there is considerable enthusiasm, Ethereum ETFs may not replicate the same success as Bitcoin, attributed to lower market capitalization and trading volumes.” Furthermore, a recent 10% decline in the price of Ether has tempered expectations further.
Disclaimer: The opinions and views expressed by the author or individuals referenced in this piece are provided for informational purposes solely and do not constitute financial, investment, or any other form of advice. Engaging in cryptocurrency investment or trading carries a risk of financial loss.
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