Grayscale Optimistic About Approval of Ethereum ETFs
Grayscale is confident that spot Ethereum exchange-traded funds (ETFs) will be approved by U.S. regulators in May, despite recent speculations about the Securities and Exchange Commission’s (SEC) engagement with applicants.
Caution Against Overinterpreting SEC Engagement
Craig Salm, Chief Legal Officer at Grayscale, expressed the firm’s optimism through a thread on X, addressing concerns about the perceived “lack of SEC engagement” with Ethereum ETF applicants.
- Highlighted parallels between spot Bitcoin ETFs and Ethereum ETFs
- Noted that critical issues were addressed during discussions with the SEC
Salm emphasized that the approval process for Bitcoin and Ethereum ETFs had many similarities, with most issues already addressed during discussions with the SEC prior to the BTC approval batch.
- ETF operations remain consistent
- Primary difference is the underlying asset – Bitcoin vs. Ethereum
Salm warned against overinterpreting the SEC’s engagement level and stated that assumptions about SEC engagement should not impact expectations for approval outcomes as the decision dates near.
- Encouraged by sentiments from industry figures like Paul Grewal and Brian Quintenz in favor of Ethereum ETF approval
Coordinated Attack and Engagement Concerns
Grayscale’s optimism contrasts with Bloomberg ETF analysts Eric Balchunas and James Seyffart, who have now lowered their odds for spot Ethereum approval in May to a pessimistic 25%.
- Analysts concerned about lack of SEC engagement
- Fear of coordinated attack on Ethereum
Balchunas expressed worry about the perceived lack of SEC engagement, speculating that it may be intentional rather than simply indecision.
The SEC’s investigation into the Ethereum Foundation has raised fears among industry experts that it could be perceived as a coordinated attack on Ethereum, potentially causing delays or denials for spot ETH ETFs.
- Paul Grewal from Coinbase argued against denying ETH ETP applications
- Travis Kling of Ikigai Asset Management saw it as a coordinated attack on ETH
Despite these concerns, companies like BlackRock, VanEck, Fidelity, and Grayscale are moving forward with their spot Ethereum ETF applications, with the SEC expected to make a decision on VanEck’s application by May 23, affecting all other applicants.
Hot Take: Ethereum ETF Approval Outlook
Given the ongoing discussions and concerns surrounding the approval of Ethereum ETFs, the next few weeks will be crucial in determining the fate of these applications. Both optimism and skepticism exist in the industry, with various stakeholders closely watching the SEC’s actions and potential decisions.
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