In an unexpected fast decision, the U.S. Securities and Exchange Commission (SEC) has approved applications from major exchanges, including Nasdaq, CBOE, and NYSE, to list exchange-traded funds (ETFs) tied to the price of ether. This approval marks a significant step forward for the cryptocurrency industry, potentially paving the way for these ether ETF products to begin trading later this year, pending final approval of their ETF registration statements.
The SEC’s decision allows nine issuers, including VanEck, ARK Investments/21Shares, and BlackRock, to launch ether ETFs. This follows the SEC’s earlier approval of Bitcoin ETFs in January. The decision was unexpected, as market participants had anticipated a negative outcome due to the SEC’s previous lack of engagement on these applications. In a surprising turn, SEC officials requested the exchanges to swiftly adjust their filings, leading to a flurry of activity within the industry to meet the new requirements.
The approval of spot ether ETFs is expected to significantly impact the digital assets market. In anticipation of the SEC’s decision, Ethereum’s price surged by 25% over the past week, reflecting investor optimism. The approval is likely to boost investor confidence further and increase market liquidity.
Industry insiders had previously expressed concerns about the SEC’s approach, describing recent interactions with the agency as one-sided, with staff withholding substantive feedback on the proposals. Despite these concerns, the approval is viewed as a positive signal towards Ethereum-based financial products and suggests that Ethereum may be considered a commodity.
However, despite the positive outcome, there remains uncertainty about when trading could commence, as the SEC has not set a specific timeframe for deciding on the ETF registration statements. Analysts estimate that it could take at least 60 days for the SEC to review the extensive disclosures in the applications before ether ETFs can start trading.
This approval represents a pivotal moment for Ethereum and the broader crypto market, indicating increased regulatory acceptance and the potential for greater mainstream adoption of digital assets.
