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Wall Street Drops a Scary Truth Bomb On Ethereum ETF Hopefuls

3M ago
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Ethereum ETF
Ethereum ETF

YEREVAN (CoinChapter.com) — On April 10, top Wall Street companies, including BlackRock, Fidelity, and VanEck, expressed doubts about the potential of the U.S. Securities and Exchange Commission’s (SEC) approval of a spot Ethereum ETF, citing tough regulatory landscapes.

“We were the first to file as well for ethereum in the U.S., and we and [Ark Invest CEO] Cathy Wood, are kind of the first in line for May, I guess, to probably be rejected,” VanEck CEO Jan van Eck told CNBC, adding:

“The way the legal process goes is the regulators will give you comments on your application, and that happened for weeks and weeks before the Bitcoin ETFs — and right now, pins are dropping as far as ethereum is concerned.”

VanEck's SEC Skepticism: A CNBC Crypto Forecast
VanEck’s Ethereum SEC Skepticism. Source: A CNBC Crypto Forecast

The crypto community’s excitement for a spot Ethereum ETF approval has been growing since the SEC approved the first spot Bitcoin ETFs in January. The commission will decide on the matter by May, and it is highly likely that it will delay the decision.

Ethereum’s native token, Ether (ETH), has rallied by more than 60% in 2024 amid the growing ETF speculations, including a 10% jump in the past week.

Ethereum's Price Surge: Tracking the Rally on CoinGecko
ETH/USD Price Surge: Tracking the Rally on CoinGecko

Ethereum’s Switch to Staking Complicated ETF Decision

SEC Chair Gary Gensler has emphasized that the agency views “the vast majority of crypto assets are investment contracts and thus fall under federal securities laws,” albeit without mentioning Ethereum. Nonetheless, most cryptocurrencies that the SEC may deem as securities are proof-of-stake (PoS), a protocol that offers interest rate returns to people for their contribution to running a blockchain network.

Related: Is Buying Ethereum Too Risky Against SEC’s Potential Crackdown?

This stance complicates the situation for an Ethereum ETF, given it recently changed its underlying consensus protocol to PoS. Meanwhile, CoinShares CEO Jean-Marie Mognetti told CNBC on April 9 that they are observing the SEC’s approach toward Ethereum “very closely.”

“I don’t expect any approvals to come before the end of this year,” he remarked, hinting at the challenges of securing SEC approval for proof of stake, a protocol unique to blockchain technology.

The post Wall Street Drops a Scary Truth Bomb On Ethereum ETF Hopefuls appeared first on CoinChapter.

3M ago
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