The U.S. Securities and Exchange Commission (SEC) approved several applications to issue spot Ethereum ETFs. Experts believe the decision indicates that the SEC will no longer consider ETH a security. The crypto community hopes the move will set a precedent for other cryptocurrencies.
The U.S. Securities and Exchange Commission (SEC) approved eight 19b-4 filings to issue exchange-traded funds (ETF) based on Ethereum (ETH) spot quotes from VanEck, BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK 21Shares, Invesco Galaxy, and Bitwise.
Besides, ETF issuers still need to get the SEC’s approval for S-1 registration statements to begin officially trading exchange-traded funds. Analysts note that this process could take a few days or even months. It also appeared that the SEC didn’t approve all the applications filed, failing to authorize the issuance of an exchange-traded fund by Hashdex.
According to industry experts, the SEC’s approval of spot Ethereum ETFs is an indirect recognition that ETH isn’t a security. James Seyffart, Analyst at Bloomberg ETF, believes that the regulator stated that it wouldn’t classify ETH as a security. Justin Browder, Digital Asset Lawyer, agrees, saying that when Ethereum ETFs get approval on S-1 applications, it’ll finally settle the debate on ETH’s status as a security.
Earlier, the SEC investigated Ethereum to recognize ETH as a security.
Still, many experts agree that the approval of Ethereum ETFs doesn’t protect ETH staking participants. They say the SEC can classify staked ETH as a security. This can be confirmed by the SEC’s recommendation for Ethereum ETF issuers, published a few days before the approval, which stated the need to exclude staking.
The regulator actively monitors the provision of services for staking cryptocurrencies. In February last year, crypto exchange Kraken was forced to close the staking program at the SEC’s request.
Some crypto community members also believe that the approval of Ethereum ETFs may set a precedent for other tokens. According to Adam Cochran, Partner at Cinneamhain Ventures, the SEC’s decision to recognize ETH as a commodity could affect similar crypto projects. However, Scott Johnson, a Financial Attorney, contends that the SEC completely sidestepped the issue of ETH’s status and an official statement on the matter should be expected soon.
The approval of spot Ethereum ETFs came four and a half months after the SEC approved spot Bitcoin ETFs. Just under a month ago, Hong Kong’s financial regulator approved spot Bitcoin and Ethereum ETFs, which were unpopular among local investors.
