The prospect of the Securities and Exchange Commission (SEC) granting approval for Ethereum spot ETFs by May 23 is losing momentum. According to a recent update shared by Fox reporter Eleanor Terrett on X, prominent anti-cryptocurrency figures such as Senator Elizabeth Warren are actively lobbying against the introduction of ETH spot ETFs. Additionally, there is limited involvement from SEC staff members in advocating for the product.
“Based on my conversations with people familiar, meetings in recent weeks have been very much one sided,” she wrote on Sunday.
Despite industry stakeholders’ efforts to encourage SEC staff to accelerate the process, there hasn’t been significant engagement from staff members, unlike their involvement with Bitcoin spot ETF applications.
The SEC is confident that it has met the expectations of the crypto industry regarding Bitcoin ETFs.
Terrett reports that SEC Chair Gary Gensler feels he has already met the industry’s expectations by approving BTC spot ETFs. Furthermore, notable anti-crypto figures like Senator Warren, who were dissatisfied with the SEC’s approval of BTC ETFs, are now mobilizing opposition against a comparable decision for ETH.
As per a source referenced by Terrett, assessing the position of the SEC staff has proven difficult, resulting in uncertainty regarding their perspectives. Nonetheless, the source underscored that for the ETH spot ETF to stand a chance of approval, SEC staff must initiate their efforts promptly, given that the May 23 deadline is looming just over two months away.
“But they’re going to have to start work soon if it’s going to have a shot.”
🚨SCOOP: Optimism about the @SECGov approving the $ETH spot ETFs by May 23rd is waning.
Based on my conversations with people familiar, meetings in recent weeks have been very much one sided, with issuers and custodians trying to rally SEC staff to get the process rolling, but…
— Eleanor Terrett (@EleanorTerrett) March 10, 2024
In January, Senator Warren voiced criticism towards the SEC following the agency’s approval of spot Bitcoin ETFs.
“If the SEC is going to let crypto burrow even deeper into our financial system, then it’s more urgent than ever that crypto follow basic anti-money laundering rules,” she said at the time.
There has been no statement from Gensler regarding ETH ETFs.
When queried about the potential decision and timeline for approving Ethereum (ETH) ETFs last month, Gensler stated that the process would mirror the approach taken for Bitcoin (BTC) ETFs. However, he refrained from offering specific details or indicating a potential timeframe for such approvals.
On February 6, the SEC opted to delay its decision on the Invesco Galaxy Ethereum ETF, marking a continuation of the postponement from December regarding Invesco’s ETF application. The SEC has similarly deferred decisions on various other Ethereum ETF applications, including those submitted by prominent firms such as Grayscale, Fidelity, and BlackRock, the world’s largest asset management company.
It’s worth highlighting that additional firms like VanEck and Hashdex are also in pursuit of Ethereum ETF approvals, with Franklin Templeton emerging as the latest asset manager to submit a spot Ethereum ETF application.
Concurrently, institutions based in Hong Kong are actively preparing to introduce spot ETFs for Ethereum, aiming to gain a competitive advantage over counterparts in the United States.
It’s noteworthy that the demand for spot Bitcoin ETFs in the US has remained robust since their launch. The cumulative net inflow of Bitcoin spot ETFs surpassed $2.24 billion last week, contributing to Bitcoin’s price surging to new all-time highs. Presently, the total assets under management of Bitcoin ETFs amount to $55.34 billion.
