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A raft of Ethereum futures exchange-traded funds (ETFs) went live in the United States this week following SEC approval, marking a first for the asset. Moreover, it may be a signal that the Security and Exchange Commission is softening its stance against ETH, according to industry experts.
On October 2, nine Ethereum futures ETFs began trading in the United States. However, initial volumes were low and industry observers remained skeptical over whether their approvals by the SEC were bullish or not.
Ethereum Futures ETFs Signal SEC Shift
Head of policy at a16z Crypto and former CFTC Commissioner Brian Quintenz commented that the move to approve an Ethereum ETF signals that the SEC may no longer consider ETH as a security.
“By approving ETH ETFs based on ETH commodity futures contracts, the SEC has officially provided clarity on ETH’s status as a non-security.”
Futures ETFs are backed by futures contracts on the Chicago Mercantile Exchange, not the physical asset. Moreover, the SEC appears comfortable with allowing these to trade However, it still hasn’t approved anything spot-based for crypto.
Quintenz added that with so much innovation being built on the Ethereum blockchain, “this creates a clearer path for builders,” before commenting:
“It’s ridiculous and insulting that it took so long to get here, but it’s a big win for the crypto space, and more importantly for the future of the internet.”
The comments did get a lot of attention from Ethereum detractors who claim that it is a security. However, the SEC, and more importantly, US Congress, has yet to classify the asset either way.
If you’re interested in trading Bitcoin derivatives, check out BeInCrypto’s guide here.
MV Capital CIO Tom Dunleavy wasn’t as bullish about the Ethereum futures ETF launches. He added,
“The only thing that matters is spot buying which a spot ETF facilitates because these funds need to be seeded.”
The funds must purchase the assets ahead of time regardless of market demand and prices. “Futures ETFs do not facilitate this latent demand,” Dunleavy concluded.
ETH Price Outlook
Ethereum prices are already retreating from their Monday spike above $1,700 as markets cool again.
ETH was down 2.9% on the day, changing hands for $1,667 at the time of writing.
ETH reached a monthly high on October 2 but sharply pulled back in search of its support zone near $1,650.
Ethereum is currently 66% down from its all-time high of $4,878 almost two years ago.