The U.S. Securities and Exchange Commission (SEC) has approved pivotal 19b-4 filings for spot ether ETFs, marking a major regulatory milestone for the cryptocurrency sector. This approval indicates a newfound willingness to engage with ether ETF issuers.
SEC Approves Key Regulatory Filings for Spot Ether ETFs
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SEC Surprises Market With Approval of Key Filings for Spot Ether ETFs
In a surprising decision, the SEC has approved key regulatory filings for spot ether exchange-traded funds (ETFs), a significant step for the second-largest cryptocurrency. The approval marks a notable about face from the regulator, which had shown little engagement with issuers on ether ETFs.
The SEC approved 19b-4 granted an accelerated approval for the following spot ether prodcuts: NYSE Arca obtained permission to list the Grayscale Ethereum Trust and the Bitwise Ethereum ETF, Nasdaq can now list the Ishares Ethereum Trust, and BZX can list the Vaneck Ethereum Trust, the ARK 21shares Ethereum ETF, the Invesco Galaxy Ethereum ETF, the Fidelity Ethereum Fund, and the Franklin Ethereum ETF. The SEC explained that “the proposals are consistent with the Exchange Act and rules and regulations thereunder applicable to a national securities exchange.”
The approval caught practically everyone by surprise. Earlier in the week while speculation about the approval intensified, James Seyffart, an ETF analyst at Bloomberg Intelligence, stated, “A week ago, I would’ve said you were a little crazy to think that these ETFs were going to get SEC approval.” Following the approval announcement, Seyffart posted the following images on X of two posts made 6 days a part:
The 19b-4 approval indicates regulators’ willingness to allow issuers to bring a spot ether ETF to the market, but it does not guarantee that the final S-1 forms will be approved for all issuers. Additionally, although this approval paves the way for these firms to list and trade spot ether ETFs, the funds are not yet cleared for trading. The issuers still need the SEC to sign off on their S-1 registration statements before investors can buy the ETFs.
Seyffart noted, “This does not mean they will begin trading tomorrow. This is just 19b-4 approval. Also needs to be an approval on the S-1 documents which is going to take time. We’re expecting it to take a couple weeks but could take longer. Should know more within a week or so!”
Vaneck expects to be the first issuer to launch its spot ether ETF, according to the company’s head of digital assets research, Matthew Sigel, who ended a lengthy post on X with, “We filed first, we should list first.”
In a statement, a Grayscale spokesperson expressed optimism about the development: “At Grayscale, we appreciate the opportunity to engage constructively with regulators as they review spot ethereum ETFs, and we remain optimistic about the potential of bringing ethereum further into the U.S. regulatory perimeter in the ETF wrapper.”
Since May 17, the Grayscale Ethereum Trust (ETHE) discount to its net asset value (NAV) shrunk from -20.52% to 5.59%. Presumably this discount will continue to shrink to zero.
What kind of affect will this have on the broader crypto markets? Share your thoughts and opinions about this subject in the comments section below.
