beincrypto.com
In a landmark decision, the U.S. SEC has approved eight spot Ethereum ETFs, including those from BlackRock and Fidelity.
This approval follows the first spot in Bitcoin ETFs, marking another milestone in the cryptocurrency market.
SEC Approves 8 Ethereum ETFs
The SEC has given the green light to the 19b-4 forms for these ETFs. However, issuers still need approval for their S-1 registration statements, a process that might take weeks or months. Bloomberg ETF analyst James Seyffart noted that this process has historically taken over three months.
The SEC’s approval was unexpected due to the lack of prior interaction with the ETF issuers. The SEC’s sudden request for the 19b-4 forms has sparked speculation about the reasons for this shift. Some insiders suggest political pressure might have influenced this decision.
A bipartisan group of lawmakers urged the SEC to approve these ETFs, arguing that the Bitcoin ETF approval set a precedent for Ethereum. As news of the potential approval spread, the discount on Grayscale Ethereum Trust shares shrank from -24% to -6%.
Since the Bitcoin ETF approval, these funds have amassed an additional 207,000 bitcoins, worth approximately $14 billion. However, Bloomberg ETF analyst Eric Balchunas estimated that Ethereum ETFs might gather 10 to 15% of Bitcoin ETFs’ assets, translating to $5 to $8 billion.
“For any normal launch in the first couple of years, that’s pretty good,” Balchunas remarked.
In response to the news of the approval, ETH is now trading at $3,870.55, up +3.77%. Additionally, stakeholders have expressed their expectations for further industry growth following this announcement. Sergey Nazarov, co-founder of Chainlink, commented on the Ethereum ETF approval:
“The Ethereum ETF approval is a second large step forward for the crypto industry. It proves that the capital markets are now getting involved in the crypto industry in earnest for some of their largest user bases and most widely used products,” Nazarov said.
He also pointed out the significance of assets utilizing smart contracts being officially approved by the SEC.
“One of the most important aspects of this ETF approval is the spotlight it places on the potential of smart contracts and decentralized applications (dApps), which are critical use cases for Ethereum. In our daily work with global banks, asset managers, and financial market infrastructures, we continue to observe increasing interest in smart contracts, the adoption of blockchain technology, and a growing interest in cryptocurrencies as a legitimate asset class,” Nazarov added.
The approval of these Ethereum ETFs signifies a pivotal moment for the cryptocurrency sector, opening doors for increased investment and setting a precedent for future digital asset regulation.