Michael Saylor believes they will not launch this year, and some issuers of funds also think so. In the meantime, some countries have a head start.
The battle to launch exchange-traded funds based on Ethereum’s spot price in the U.S. is heating up — and so far, the journey looks similar to Bitcoin’s long and messy road to approval.
Again, the U.S. Securities and Exchange Commission delays in revealing a final answer on the already submitted applications. The green light is important because it allows investors to get exposure to ETH even if they don’t own the underlying asset.
Grayscale The following are some examples of how to get started: Franklin Templeton Both companies were due to get a reply from SEC by April. However, the regulator has now extended their deadlines to June.
Fidelity & BlackRock also saw similar applications put on hold. VanEck & ARK Invest will receive a decision later this month. But the chances of getting approved are dwindling.
Why? Ether has been labelled a “security” by regulators, not just a currency like Bitcoin.
Growing dispute
Gary Gensler refused to answer the question in June 2023 when he appeared before the House Financial Services Committee.
The lack of a clear answer had spooked the crypto industry — especially considering this contradicted earlier guidance made by his predecessor Jay Clayton.
Even earlier, Gensler hinted at the possibility that the stake process could fall under the securities laws around The Merge, in September 2022.
Ether’s status matters because it determines which organization holds regulatory oversight in the U.S. — and if it It is a good idea to use a bilingual translator A security could lead to big issues for other altcoins.
Recent consensus sued the SEC and leapt to Ethereum’s defense — arguing the commission’s “unlawful power grab threatens to undermine America’s position as a leader of the next generation of the internet.”
Saylor’s Prediction
Michael Saylor is the executive chairman of MicroStrategy. He has been a strong supporter of Bitcoin and spearheaded efforts for adding hundreds of thousands BTCs to MicroStrategy’s balance sheet. doesn’t believe It is unlikely that any ETFs based upon ETH spot prices will be released. He warned at the Bitcoin for Corporations annual event:
“Some time this summer, it’ll be very clear to everyone that Ethereum is deemed a cryptoasset security, not a commodity. After that, you’re gonna see that Ethereum, BNB, Solana, Ripple, Cardano — everything down the stack — is just a cryptoasset security unregistered. None of them will ever be wrapped by a spot ETF, none of them will be accepted by Wall Street, none of them will be accepted by mainstream institutional investors as cryptoassets. [Bitcoin] is the one universal, consensus accepted, institutional-grade cryptoasset in the world. There won’t be another one.”
Michael Saylor
Of course, you could argue that Saylor was bound to say this — especially considering that he believes BTC is the only cryptocurrency that is technically and ethically sound. In July 2022 at the Blockchain Economy Istanbul Summit, Saylor warned of Ether’s constant upgrades. “introduce new attack surfaces” That undermines security and reliability.
What is happening? next?
It appears that the biggest challenge is a lack in communication between SEC and those firms who want to introduce an Ether-based ETF. As Barron’s reported Last month’s applicants weren’t given “the critical feedback needed to finalize their products.” BTC ETFs, on the other hand, had been involved in an illicit activity. “robust back-and-forth” Prior to the trading of their fund, they should have contacted them.
Jan van Eck’s eponymous firm of investment is waiting for a SEC verdict. told CNBC reported in April, that the CNBC analyst believes he will be able to make an application. “probably be rejected” — while Jean-Marie Mognetti from CoinShares predicted that no approvals will happen in 2024.
The U.S. is still paralyzed with regulatory uncertainty. Crypto firms are frustrated by the lack of clarity regarding Ether’s legal status.
Hong Kong launched a ETH ETF despite the low volume of trading on its first day. speculation This could open up the doors to mainland Chinese investors one day.
As S&P Global recently noted, funds based on Ether’s spot price have already been approved in Canada, Switzerland, Sweden and Germany — with some offering additional yield by offering staking returns as well.
The U.S. is at risk of falling behind as ETFs on other continents now manage billions of dollars.
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Source: crypto.news