By George Ward
A commissioner of the US Securities and Exchange Commission (SEC) has stated that securing regulatory clearance for exchange-traded fund (ETF) applications, including spot Ether (ETH), will not necessitate a judicial struggle. The Commissioner made the statement following skepticism that a spot Ethereum ETF will be more difficult to approve than a Bitcoin ETF.
Hester Peirce On Spot ETH ETF Approval
While speaking during a recent interview, Hester Peirce, also known as “Crypto Mom,” stressed that the SEC does not require a court order to overhaul its operating procedures. She opined that the court’s previous judgment in the case between the regulator and Grayscale paved the way for the legalization of spot Bitcoin ETF in the United States.
However, Peirce underlined the importance of avoiding “arbitrary and capricious” techniques, stating that the regulator is not waiting for a court to tell it to fix its approaches. According to Peirce, legal challenges will not influence the organization’s decision-making process. On the contrary, considerable and thoughtful deliberation is being given to improving the approval procedure for spot Ether ETFs.
Applying The Grayscale Approach
Known for her pro-crypto stance, the Commissioner stated that the agency would likely consider the Grayscale precedent when evaluating applications for exchange-traded funds interested in trading spot Ether. Nevertheless, Peirce stressed the uniqueness of each ETF proposal, acknowledging the significant differences in conditions and factual knowledge.
Furthermore, Peirce outlined the rigorous procedure for making an exchange-traded product accessible for purchase, highlighting the importance of ensuring that disclosures conform to the instrument’s genuine functionality. Like it was with spot BTC ETF proposals, prominent asset managers such as BlackRock, ARK 21Shares, Fidelity, Galaxy, Hashdex Grayscale, VanEck, and Invesco are also among the entities requesting the SEC’s clearance for spot Ether ETFs.
Meanwhile, Eric Balchunas, a senior ETF analyst at Bloomberg, predicted that spot Ether ETF clearance would be achieved with a 70% chance by May. The SEC will likely decide on the requests from Invesco, VanEck, ARK 21Shares, Hashdex, and Grayscale by July 5, with other deadlines ranging from May 23 to July 5.
However, the conclusions on Fidelity and BlackRock’s applications are scheduled for August 3 and August 7, respectively. Nevertheless, Balchunas stressed the interconnection between the markets for Ether and Bitcoin, expressing hope of approvals for spot Ether ETFs.
Skepticism Over Spot Ether ETF Approval
Although many participants in the crypto ecosystem are optimistic that the regulator would approve a spot ETH ETF, some analysts have their concerns. Mark Yusko, the CEO of Morgan Creek Capital, opined that the likelihood of a spot Ether ETF being approved is less than 50%.
According to him, the SEC is hostile toward the crypto industry. It’s worth noting that, SEC Chair Gary Gensler, in a letter dated January 11, stated that the approval of a spot Bitcoin ETF does not imply automatic support for all applications for cryptocurrency ETFs.
He added that this approval does not mean the Commission is willing to adopt listing criteria for a broader range of crypto asset instruments. Still, the SEC chair reaffirmed his stance about crypto assets, stating that most are investment contracts. Therefore, they should be governed by federal securities laws without favoring any particular crypto asset.