- The SEC has partially approved Spot Ethereum ETFs, allowing the 19b-4 filings as a first step.
- Complete approval depends on the S-1 registration, detailing operations, financials, and risks, which is under review.
- According to analysts, full SEC approval could accelerate, potentially concluding by mid-June after minimal revisions.
And it’s done!
What seemed unlikely a week ago has become reality: the United States Securities and Exchange Commission (SEC) has partially approved the Spot Ethereum exchange-traded funds (ETFs).
Related: Glassnode Report Suggests Big Price Move Ahead For Crypto, Despite Moderate Capital Flow
The news broke when Bloomberg ETF analyst James Seyffart – who reported and commented throughout both the ETH and Bitcoin ETF saga – dropped these historic lines in a tweet:
But don’t get too excited just yet. While the approval is great news for Ethereum and probably all of crypto, there is a catch. The approval is for the 19b-4 filings only and now applicants will have to wait for S-1 approval, which takes time, Seyffart said.
Form 19b-4 filings are primarily related to rule changes within trading venues, such as exchanges, that wish to list new financial products like ETFs. This form outlines how the new ETF will operate and how it complies with the regulatory requirements.
The S-1 registration statement on the other hand is used by companies issuing new securities to the public, which includes ETF sponsors who are creating new funds.
The S-1 document provides detailed information about the company’s operations, financials, management, and the risks associated with the investment. For ETFs, the S-1 includes specifics about the fund’s objectives, fees, operations, and the underlying assets it will hold.
Expect a Few Weeks of Waiting Time
Fellow Bloomberg analyst Eric Balchunas explained that with the worst out of the way from here on it’s just waiting time. While it could take several months for the SEC to come out with comments on the S-1 filings, both analysts think the process could be sped up like with the BTC ETFs.
Although the S-1 filings can come with several rounds of comments by the SEC and amendments by the applicants, Balchunas estimates only one round and a potential approval by mid-June.
After weeks of silence by the SEC and then a sudden move like the one we have just seen, we probably shouldn’t expect too many revelations by the regulator until then. Or as SEC chair Gary Gensler had put it just before the 19b-4 approval:
We do it within the law and how the courts interpret the law, and that’s what I’m deeply committed to. I don’t have anything on this particular filing – stay tuned.
Gary Gensler, SEC chair Get the most important crypto news delivered to your inbox by subscribing to the CNA newsletter
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