SEC Approves Spot Ether ETF Listing, Still Needs to Approve Issuers’ Filings

The SEC has given preliminary approval to the forms related to the ETFs, known as 19b-4 forms. However, before investors are able to purchase these ETFs, the Securities and Exchange Commission still needs to give its final approval by approving their S-1 filings.

The SEC’s approval comes after an impressive reversal in their stance towards the markets. Previously this year, they gave the green light for spot bitcoin ETFs but showed little engagement with issuers regarding ether ETFs. However, things have taken a different turn in recent days.

“Last week, I would have considered your view on these ETFs getting SEC approval as somewhat unconventional,” expressed James Seyffart, an ETF analyst at Bloomberg Intelligence, during a recent interview before the ruling was announced.

In a statement, a Grayscale spokesperson confirmed the regulator had approved its 19b-4.

Grayscale expressed gratitude for the chance to collaboratively discuss Ethereum spot ETFs with regulators. They continue to hold a positive outlook regarding the possibility of incorporating Ethereum more extensively within the United States regulatory framework through an ETF structure.

As a researcher studying the potential entrants into the ethereum-based exchange-traded fund (ETF) market, I have identified several key players who are strongly positioned to launch such products. Among them are BlackRock, Fidelity, Grayscale, VanEck, Franklin Templeton, Ark Invest/21Shares, and Invesco/Galaxy. These firms have established reputations in the ETF industry and have shown interest or expertise in digital assets, making them likely candidates for launching ethereum ETFs.

While the acceptance of 19b-4 filings indicates that regulators may permit the launch of a spot Ethereum ETF, it does not ensure that they will eventually give the green light to the final S-1 forms submitted by every applicant.

Seyffart expressed that it’s anticipated there will be a delay before we can expect S-1 approvals and subsequent ETF trading to commence. In his estimation, this process may take at least a week, but could realistically last longer, possibly even several months based on historical trends. However, he personally believes the wait will fall within the timescale of weeks. At present, all predictions are speculative.

As a crypto investor, I was taken aback on Monday when news broke that regulators had requested updates from issuers regarding their 19b-4 filings before the SEC made its decision on approving or denying one of those applications, specifically VanEck’s.

The SEC representative declined to provide additional comments, only reiterating the contents of the statement released on Thursday.

UPDATE (May 23, 2024, 21:30 UTC): Adds additional information, including SEC statement.