SEC Quells Down ETH ETF Amidst Bullrun

Following the hype surrounding spot Bitcoin ETFs, ETH ETFs are what’s catching everyone’s attention at the moment.

The Securities and Exchange Commission has delayed its decision timeline on BlackRock’s proposal for a spot Ethereum exchange-traded fund (ETF), according to a Monday filing.

This is not the first time the SEC has pushed back its decision for BlackRock’s iShares Ethereum Trust – but this doesn’t come as a surprise.

In fact, it was widely anticipated that the regulator would delay its decision for a second time.

The SEC asked question on Monday from the public on whether this ETF should be approved, mostly focusing on whether Ethereum’s proof-of-stake mechanism raised “unique concerns about ether’s susceptibility to fraud and manipulation”.

Not only this, but Fidelity’s spot Ethereum ETF has also been delayed – with the SEC addressing the same concerns as it did for BlackRock.

Did you know? Both BlackRock and Fidelity had filed for their spot ETH ETFs back in November.

BlackRock’s Bitcoin ETF had massive trading days last week, recording over $1.3bn in daily trading volume for two consecutive days.

Since then, other firms have joined what seems to be a “trend” – including Franklin Templeton, Ark21Shares, VanEck, and Grayscale.

The decision comes right after Hester Peirce – SEC’s Commissioner – publicly blamed her own agency for delaying spot BTC ETFs decision previously.

Recommended Read: Trouble in Gensler’s House?

While we would’ve expected for things to go smoother after such bold comments from the commissioner herself, Gensler seems not to be bothered, at all.

Gary Gensler has always been known for his stance on cryptocurrencies… but does this have to necessarily reflect on the SEC’s decision?

Not only this, but this repeated behaviour from the regulator has started to raise concerns on whether the SEC is the most suitable when it comes to regulating the markets.

It is no secret that regulation is indeed required, especially at times where fraud and scams have become majorly present in cryptocurrency markets – but from what we have seen so far, “regulating by enforcement” has certainly not been the best approach.

Isn’t it about time Gensler steps up his game, and works towards better regulatory measures? Guess we won’t have an answer anytime soon.

Approval or No Approval?

Several schools of thoughts have emerged regarding whether the spot ETH ETF will be eventually approved.

Some crypto experts seem on the more positive side, saying they anticipate an approval from the SEC sometime around May. Moreover, Bitcoin ETFs recent approvals are leading the way for spot ether ETFs.

Conversely, other analysts with a more cautious outlook still view the approval as uncertain…

Chair Gary Gensler, meanwhile, has stated that the agency’s approval of spot Bitcoin ETFs were just “cabined” to those and “shouldn’t be read to be anything other than that”.

"As I said two weeks ago, that which we did with regard to bitcoin exchange traded products is cabined to this one commodity non-security and shouldn't be read to be anything other than that," Gensler said during a media briefing when asked for his thoughts on ether ETFs. 

However, why would BTC ETFs be approved, but not ether?