Ethereum Spot ETF Approval Remains Uncertain
The Securities and Exchange Commission (SEC) is currently considering applications for spot exchange-traded funds (ETFs) for ether (ETH), the native token of the Ethereum blockchain. However, experts are increasingly skeptical about the likelihood of approval in the near future.
Challenges to Approval
Recent reports suggest that the SEC has issued subpoenas to crypto firms regarding their relationship with the Ethereum Foundation, which has cast doubt on the possibility of approval in May. The SEC's lack of active engagement with ETF applicants and its investigation into whether ether should be classified as a security have also contributed to the uncertainty.
Classification of Ether as a Security
The SEC's Chairman, Gary Gensler, has refused to comment on whether the agency considers ETH a security. The SEC's views on the matter are crucial, as it could impact the approval of spot Ethereum ETFs. If the SEC were to classify ETH as a security, it would likely face significant legal and regulatory hurdles.
Industry Expectations
Despite the challenges, some industry experts remain optimistic about the eventual approval of spot Ethereum ETFs.
JPMorgan, for instance, believes that the SEC will eventually approve such ETFs, although it may not happen as soon as May. Others, like Bloomberg senior ETF analyst Eric Balchunas, are less optimistic, putting the chances of May approval at 25%.
Current Status
The SEC has opened a window for comments on three ether spot ETF proposals, including those from Grayscale Investments, Fidelity, and Bitwise. The agency has until May 23 to make a final decision on some of the ETF applications.
While there are ongoing efforts to launch spot Ethereum ETFs, the approval process faces significant challenges, including the SEC's investigation into the Ethereum Foundation and the classification of ether as a security. As a result, the likelihood of approval in the near future remains uncertain.