SEC Tentatively Approves Spot Ethereum ETFs: Here’s What Happens Next
Complete approval depends on the S-1 registration, detailing operations, financials, and risks, which is under review.
According to analysts, full SEC approval could accelerate, potentially concluding by mid-June after minimal revisions.
And it’s done!
What seemed unlikely a week ago has become reality: the United States Securities and Exchange Commission (SEC) has partially approved the Spot Ethereum exchange-traded funds (ETFs).
Related: Glassnode Report Suggests Big Price Move Ahead For Crypto, Despite Moderate Capital Flow
The news broke when Bloomberg ETF analyst James Seyffart – who reported and commented throughout both the ETH and Bitcoin ETF saga – dropped these historic lines in a tweet:
BOOM!! APPROVED! There it is. The SEC just approved spot #Ethereum ETFs. What a turn of events. It’s really happening.
h/t @PhoenixTrades_ pic.twitter.com/KQ39mDyCbT
— James Seyffart (@JSeyff) May 23, 2024
But don’t get too excited just yet. While the approval is great news for Ethereum and probably all of crypto, there is a catch. The approval is for the 19b-4 filings only and now applicants will have to wait for S-1 approval, which takes time, Seyffart said.
Form 19b-4 filings are primarily related to rule changes within trading venues, such as exchanges, that wish to list new financial products like ETFs. This form outlines how the new ETF will operate and how it complies with the regulatory requirements.
The S-1 registration statement on the other hand is used by companies issuing new securities to the public, which includes ETF sponsors who are creating new funds.
The S-1 document provides detailed information about the company’s operations, financials, management, and the risks associated with the investment. For ETFs, the S-1 includes specifics about the fund’s objectives, fees, operations, and the underlying assets it will hold.
TO BE CLEAR: 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!
— James Seyffart (@JSeyff) May 23, 2024
Expect a Few Weeks of Waiting Time
Fellow Bloomberg analyst Eric Balchunas explained that with the worst out of the way from here on it’s just waiting time. While it could take several months for the SEC to come out with comments on the S-1 filings, both analysts think the process could be sped up like with the BTC ETFs.
The imp part is over. Now just logistics. My guess is there’s only one round of comments on the S-1s. And during btc one round took two weeks ish. So I this mid June is certainly poss. Just a guess tho. We will see.
— Eric Balchunas (@EricBalchunas) May 23, 2024
Although the S-1 filings can come with several rounds of comments by the SEC and amendments by the applicants, Balchunas estimates only one round and a potential approval by mid-June.
After weeks of silence by the SEC and then a sudden move like the one we have just seen, we probably shouldn’t expect too many revelations by the regulator until then. Or as SEC chair Gary Gensler had put it just before the 19b-4 approval:
We do it within the law and how the courts interpret the law, and that’s what I’m deeply committed to. I don’t have anything on this particular filing – stay tuned.
Stay tuned!
“Iam going to delay that thing again and again and again!” pic.twitter.com/qn4X3v8sqD
— CRYPTOTAG | Seed Phrase Storage (@CRYPTO_TAG) May 23, 2024
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The post SEC Tentatively Approves Spot Ethereum ETFs: Here’s What Happens Next appeared first on Crypto News Australia.
Filed under: Bitcoin - @ May 24, 2024 1:03 am