SEC Grants Final Approval To Spot Ether ETFs

The U.S. Securities and Exchange Commission (SEC) gave final approval to spot Ether exchange-traded fund (ETF) applicants, meaning the funds are on track to begin trading on Tuesday morning.

On July 22, the SEC greenlit the S-1 registration statements from seven ETF issuers spanning BlackRock, Franklin Templeton, Fidelity, VanEck, Bitwise, 21Shares, and Invesco. The move follows the SEC approving the 19b-4 filings for eight spot Ether ETFs in May, and two funds last week.

“The approval of spot Ethereum ETF is yet another pivotal milestone for digital assets,” said John O’Loghlen, the APAC managing director at Coinbase. “Solidifying ETH as a non-security is a seminal moment for the industry and indicates more broadly the acceptance and integration of crypto within traditional finance markets.

The SEC is yet to give the nod to S-1 registration statements Grayscale Ethereum Trust (ETHE), Grayscale Mini Ethereum Trust, and the ProShares Ethereum ETF. However, James Seyffart, an ETF analyst for Bloomberg, said he expects Grayscale to receive approval for its S-1 filing documentation on July 23, noting that the SEC announced the approval of Grayscale’s Bitcoin ETF conversion on the day that spot Bitcoin ETFs began trading in January.

Roughly one hour ago, Grayscale also uploaded a page for ETHE on its website stating the fund will list as an ETF on July 23.

As such, all of the funds except for the ProShares Ethereum ETF are expected to launch tomorrow, with analysts tipping that the ETFs would enter the markets on July 23 for the past week. The Chicago Board Options Exchange validated those predictions on July 20 by announcing that five spot Ethereum ETF would begin trading on its exchange come July 23.

The significance of spot Ether ETFs lies in their ability to make Ethereum more accessible and attractive, particularly to institutional investors. These ETFs allow investors to gain exposure to ETH without the complexities of directly buying and storing the cryptocurrency.

This ease of access, combined with regulatory approval, can bring increased legitimacy and trust to Ethereum. Additionally, the introduction of spot ETH ETFs is expected to boost market demand and liquidity, accelerating its mainstream adoption within traditional financial markets.

Market action

Despite the S-1 approvals and imminent ETF launches, Ethereum is trading flat. The price of ETH last changed hands for $3,445 after sinking 1% over the past 24 hours, according to The Defiant’s crypto price feeds. ETH is up roughly 14.5% since the start of May — three weeks prior to the approval of spot Ether ETFs’ 19b-4 filings.

However, the price of ETH is up 0.5% against Bitcoin over the past 24 hours at 0.052 BTC, and has gained 15.4% since bottoming out at 0.045 BTC in mid-May.

Analysts predict that the Ether funds will attract between 10% and 25% of the inflows hosted by Bitcoin ETFs, which have amassed more than $14 billion to rank as the fastest-growing class of exchange-traded funds since launching.

“The Spot ETF inflows could have a bigger impact on Ether than Bitcoin,” said Danny Choing, co-founder of Tranchess. “The Ether/BTC price ratio has already seen positive movement as investors anticipate ETH ETFs to go live soon. This not only highlights increased interest but is also a sign that ETH ETFs are gaining momentum and could potentially outperform Bitcoin.“