News
Cryptocurrencies: SEC Approved Ethereum ETFs!
5h30 ▪ 4 minute read ▪ by Luc Jose A.
The crypto ecosystem is abuzz after the SEC’s stunning announcement: the approval of Ethereum ETFs. This decision, which could redefine institutional investors’ access to digital assets, comes at an important time for the market. While Bitcoin had already led the way with its own ETFs earlier this year, Ethereum, the second largest cryptocurrency by market capitalization, is set to gain unprecedented exposure to traditional financial markets.
The historic approval of Ethereum ETFs
Last night, the Securities and Exchange Commission (SEC) of the United States took a decisive step by approving several Ethereum ETF applications, marking a significant step forward for the second largest cryptocurrency. Among the companies that have received SEC approval are financial giants such as BlackRock, Fidelity, Grayscale, VanEck, Franklin Templeton, Ark/21Shares and Invesco/Galaxy. This approval covers the 19b-4 forms, which are essential for the establishment of these funds, but one crucial step remains: the approval of the S-1 forms, which is necessary before the ETFs can be marketed.
James Seyffart, Bloomberg analyst, highlights the unexpected nature of this decision by stating, “A week ago, I would have said you were a little crazy to think these ETFs would get SEC approval.” This observation highlights the speed and unpredictability of the SEC’s change in stance, which until recently seemed reluctant to engage in discussions with Ethereum ETF issuers.
Grayscale, one of the companies benefiting from this approval, expressed its satisfaction through a spokesperson: “At Grayscale, we appreciate the opportunity to collaborate constructively with regulators as they review Ethereum ETFs, and we remain optimistic about the potential of bring Ethereum to the United States. regulatory framework through ETFs”.
Towards a new investment paradigm
While approval of Forms 19b-4 suggests regulators’ willingness to allow Ethereum ETFs to be marketed, it does not guarantee final approval of Forms S-1. According to James Seyffart, “There is likely to be a delay before we see S-1 approvals and the start of trading for these ETFs. My estimate is that it will take at least a week, but probably longer. If history can teach us anything, it could take much longer and be measured in months.” This statement reflects the uncertainty that still looms over the exact timing of the launch of these new financial products.
In any case, the SEC’s approval of Ethereum ETFs not only represents a significant step for the issuers of these products, but could also have profound implications for the cryptocurrency market as a whole. This follows the successful introduction of Bitcoin ETFs in January, which quickly attracted $13.3 billion in net inflows, setting performance records for ETFs upon their launch. The arrival of ETFs on Ethereum could see similar success, attracting a new influx of capital into the second largest cryptocurrency.
This reversal from the SEC comes amid pro-crypto movements within the US Congress, where several recent votes have shown growing support for cryptocurrency-friendly legislation. For example, last week, the Senate passed a resolution to repeal Staff Accounting Bulletin 121, thereby making it easier for regulated banks to offer cryptocurrency custody services. Also, the House of Representatives passed the Financial Innovation and Technology for the 21st Century Act (FIT21)which should bring much-needed legal clarity to cryptocurrencies.
Maximize your Cointribune experience with our “Read to Earn” program! Earn points for every article you read and access exclusive rewards. Sign up now and start earning benefits.
Click here to sign up to “Read to Earn” and turn your passion for cryptocurrencies into rewards!
Luc Jose A.
Graduated in Science Po Tolosa and holder of a blockchain certification consultant issued by Alyra, I returned to participate in Cointribune in 2019. Capturing the potential of blockchain to transform numerous sectors of the economy, I have made a commitment to raise awareness and inform the great public about this constantly evolving ecosystem. My goal is to allow anyone to better understand blockchain and learn about the opportunities it offers. I strive every day to provide an objective analysis of current events, to decipher market trends, to convey the latest technological innovations and to put into perspective the economic and social efforts of this revolution in brands.
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be relied upon as investment advice. Do your research before making any investment decisions.