SEC Pushes for Updates on Spot Ether ETF Applications

The United States Securities and Exchange Commission (SEC) has reportedly reached out to major U.S. exchanges. These including Nasdaq, the Chicago Board Options Exchange (CBOE), and the New York Stock Exchange (NYSE), to update their applications for listing and trading spot Ether exchange-traded funds (ETFs) from asset managers.

This move comes ahead of a critical regulatory deadline on May 23, when the SEC must decide whether to approve or deny VanEck’s spot Ether ETF after a 240-day delay.

Increased Odds for Spot Ether ETF Approval

Recent reports indicate that the SEC’s outreach to exchanges could signal a higher likelihood of regulatory approval. Two ETF analysts have raised their odds of approval for a spot ETF tied to Ether from 25% to 75% after hearing indications that applicants should expedite their 19b-4 filings. These filings, along with S-1 registration statements, are prerequisites for listing spot Ether ETFs.

Ripple Effect on Industry

Approval of VanEck’s application could pave the way for similar approvals for spot Ether ETFs offered by other major asset managers such as ARK 21Shares, BlackRock, Fidelity, Hashdex, and Invesco Galaxy.

Fidelity, for instance, has already made amendments to its S-1 filing. This indicates that Ether tied to its investment vehicle will not be staked, potentially setting a precedent for approval criteria.

SEC’s Stance and Potential Outcomes

While the SEC has previously hinted at a possible denial of spot Ether ETF applications, the situation remains fluid. Past SEC filings, public statements from Chair Gary Gensler, and reports of investigations have fueled uncertainty.

Notably, the commission began approving investment vehicles tied to ETH futures in October 2023 and spot Bitcoin ETFs in January. As the May 23 deadline looms, the industry awaits the SEC’s decision with anticipation and apprehension.

Image by fabrikasimf on Freepik