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First Bitcoin, now Ether: the SEC opens the doors to Ethereum ETFs
In a historic decision, the U.S. Securities and Exchange Commission (SEC) signaled its approval for the potential launch of eight exchange-traded funds (ETFs) tied to ether, the world’s second-largest cryptocurrency. This move follows the SEC’s approval of the first bitcoin ETFs earlier this year, marking a significant shift in the regulatory landscape for digital assets.
Thursday’s SEC approval resulted in crucial rule changes that pave the way for ETFs that invest directly in ether, the native cryptocurrency of the Ethereum blockchain. Requests from major financial groups such as BlackRock, Fidelity, Invesco and Ark Invest have received the green light. While this represents an important step forward, a second round of approvals will be required before these products can be officially launched.
The wait for these approvals has fueled a surge in the price of Ether, which has risen more than 20% since Monday and more than 60% since the start of the year. This reflects the growing confidence among investors regarding the general acceptance of cryptocurrencies.
The SEC’s decision comes after months of silence on the matter. On Monday, the regulator unexpectedly provided feedback on pending requests to issuers and exchanges, triggering a flurry of reviews and document submissions. This quick action was likely motivated by the approaching deadlines for responses to ether ETF requests from VanEck and Ark Invest.
While Thursday’s SEC approval marks a significant milestone, the timing of the second round of approvals and subsequent launch of ether ETFs remains unclear.
Commenting on the development, Sergey Nazarov, co-founder of Chainlink said: “The approval of the Ethereum ETF is a second big step forward for the cryptocurrency industry… The attention and adoption of the Ethereum ETF demonstrates We have also built our long-term thesis around the fact that capital markets will be the next big source of adoption for the cryptocurrency industry, essentially being the key force that is taking it to new heights.”
Nazarov highlighted the approval’s potential to shine a spotlight on Ethereum’s smart contract and decentralized application capabilities, which are attracting growing interest from major financial institutions.
This historic decision by the SEC could potentially usher in a new era for cryptocurrencies, further solidifying their integration into traditional financial markets.