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Spot Ethereum ETFs have finally received the greenlight after a period of uncertainty. Thursday’s approval not only marked a milestone for Ethereum but also a positive development in the US regulatory approach to crypto. This article will provide more insights into the recent approval, its potential motivation, and implications for the industry.
An overview of spot Ethereum ETF approval
On May 23, the US Securities and Exchange Commission (SEC) approved the 19b-4 forms associated with eight spot Ethereum ETFs. These include Blackrock’s iShares Ethereum Trust, VanEck Ethereum Trust, Fidelity Ethereum Fund, ARK 21Shares Ethereum ETF, Franklin Ethereum ETF, Bitwise Ethereum ETF, Grayscale Ethereum Trust, and Invesco Galaxy Ethereum ETF.
The latest approval follows the debut of spot Bitcoin ETFs in the US in January. However, unlike Bitcoin ETFs, the Ethereum products still need S-1 form approval to fully operate, which is pending review now.
As reported by Crypto Briefing, the securities watchdog recently started engaging with ETF issuers on S-1 forms. This development likewise confirmed some previous speculation that the SEC lacked interaction with the issuers during the review process.
Considering previous cases, Bloomberg ETF analyst James Seyffart estimates that it may take the SEC up to five months to clear the spot Ethereum funds for trading. However, the analyst suggests that the timeline can be extended.
Key factors influencing approval
According to the SEC’s approval document, the correlation between Ethereum futures ETFs and spot ETFs was one of the key factors influencing the decision.
Notably, the SEC conducted its own analysis to verify the correlation results provided by Bitwise’s amendments and other commenters, including the Coinbase Letter and CF Benchmarks Letters. The SEC’s findings confirmed the high correlations reported, indicating a robust linkage between the CME Ethereum futures and spot Ethereum markets.
Other considerations addressed in the approval document include investor protection, market integrity, volatility, and risk concerns.
However, Jake Chervinsky, chief legal officer at Variant, claimed that the SEC…
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