SEC Approval of Ethereum Spot ETFs in Doubt as Anti-Crypto Politicians Oppose
The optimism surrounding the Securities and Exchange Commission’s (SEC) potential approval of Ethereum spot ETFs by May 23 is diminishing. Influential anti-cryptocurrency politicians, including Senator Elizabeth Warren, are actively opposing the passage of ETH spot ETFs, while SEC staff members have shown limited engagement in promoting the product.
“Based on my conversations with people familiar, meetings in recent weeks have been very much one-sided,” wrote Fox reporter Eleanor Terrett.
Industry stakeholders have been trying to rally SEC staff to expedite the process, but staff members have not shown meaningful engagement as they did with Bitcoin spot ETF applications.
SEC Believes it has Satisfied Crypto Industry with Bitcoin ETFs
According to Terrett, SEC Chair Gary Gensler believes that he has already appeased the industry with the approval of BTC spot ETFs. Additionally, influential anti-crypto politicians, such as Senator Warren, who were already displeased with the SEC’s approval of BTC ETFs, are rallying against a similar outcome for ETH.
Gauging the stance of the SEC staff has been challenging, leaving uncertainty about their thought process. However, if the ETH spot ETF has any chance of approval, SEC staff will need to commence their work soon considering the May 23 deadline is just over two months away.
Back in January, Senator Warren criticized the SEC after the agency greenlighted spot Bitcoin ETFs. She emphasized the importance of crypto following basic anti-money laundering rules.
Gensler Remains Silent About ETH ETFs
When questioned about the possibility of a decision and the timeline for ETH ETF approval last month, Gensler said that the process would follow the same approach as Bitcoin (BTC) ETFs. However, he refrained from providing any specific details or a potential timeframe.
The SEC has postponed its decision on the Invesco Galaxy Ethereum ETF, which followed a delay in December concerning Invesco’s ETF application. The SEC has also deferred decisions on other Ethereum ETF applications, including those from prominent firms like Grayscale, Fidelity, and BlackRock.
Notably, other firms such as VanEck and Hashdex are also seeking Ethereum ETF approvals, with Franklin Templeton becoming the latest asset manager to file a spot Ethereum ETF application. Meanwhile, Hong Kong-based institutions are actively preparing to launch spot ETFs for Ethereum in a bid to gain an edge over the United States.
It is worth noting that demand for spot Bitcoin ETFs in the US has remained strong since their launch. The cumulative net inflow of Bitcoin spot ETFs surpassed $2.24 billion last week, propelling the price of Bitcoin to reach new all-time highs. The total asset under management of Bitcoin ETFs currently stands at $55.34 billion.
Hot Take: SEC Approval Unlikely for ETH Spot ETFs
The optimism surrounding the approval of Ethereum spot ETFs by the SEC is diminishing due to opposition from influential anti-crypto politicians and limited engagement from SEC staff members.
SEC Chair Gary Gensler believes that he has already satisfied the crypto industry with the approval of Bitcoin spot ETFs and influential anti-crypto politicians like Senator Elizabeth Warren are rallying against a similar outcome for ETH.
The stance of SEC staff members remains uncertain, but if there is any chance of approval for ETH spot ETFs by May 23, they need to start their work soon.
Meanwhile, other firms and asset managers are also seeking Ethereum ETF approvals, and Hong Kong-based institutions are actively preparing to launch spot ETFs for Ethereum.
While the demand for spot Bitcoin ETFs in the US remains strong, the approval of ETH spot ETFs is uncertain at this time.
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