The US Securities and Exchange Commission (SEC) approved applications from major exchanges, including Nasdaq, CBOE, and the NYSE, to list exchange-traded funds tied to the price of ether today (Thursday). This approval potentially opens the door for these products to begin trading later this year.
Issuers to Seek Regulatory Approval
Nine issuers, including VanEck, ARK Investments/21Shares, and BlackRock, applied to launch ETFs tied to ether following the SEC's approval of spot Bitcoin ETFs in January. Despite the positive feedback, these applicants must obtain approval for ETF registration statements detailing investor disclosures before the funds can start trading.
The SEC’s notice stated: "After careful review, the commission finds that the proposals are consistent with the Exchange Act and rules and regulations thereunder applicable to a national securities exchange. In particular, the commission finds that the proposals are consistent with Section 6(b)(5) of the Exchange Act, which requires, among other things, that the exchanges' rules be designed to prevent fraudulent and manipulative acts and practices and, in general, to protect investors and the public interest."
US SEC approves exchange applications to list spot ether ETFs https://t.co/zvJ6e0L99U pic.twitter.com/okQKGNpLxx
— Reuters (@Reuters) May 23, 2024
Market participants were prepared for a negative outcome, especially considering the lack of engagement from the SEC on the applications, Reuters reported. However, in an unexpected turn of events, the SEC's officials requested the exchanges to make quick adjustments to the filings on Monday, leading to a rush to meet the new requirements in a short time.
Positive Market Sentiment Boosts Ether
However, the SEC has not set a deadline to decide on the registration statements, leaving industry participants uncertain about when trading could commence. Optimism about the SEC's approval of ether ETF pushed the price of the second-largest cryptocurrency by 25% on the weekly chart. Notably, the asset management firm plans to avoid stakingand derivatives to address regulatory concerns.
In the run-up to the decision-making deadline, the SEC’s Chair Gary Gensler, known for his skepticism toward cryptocurrencies, declined to comment when reporters asked about the ether ETFs. A spokesperson from the commission also stated that the agency would not provide further comments on the matter. Earlier, a section of US Congress urged Gensler to approve ether ETFs.
This article was written by Jared Kirui at www.financemagnates.com.
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