Grayscale Remains Optimistic on Ether ETF Approvals

1. Grayscale remains optimistic about spot Ether ETF approvals despite concerns over SEC’s engagement.
2. ETF issuers have addressed many common issues, paving the way for potential spot Ether ETF approvals.
3. Concerns over SEC’s lack of engagement prompt Bloomberg analysts to reduce odds of spot Ether ETF approval to 25%.

Despite concerns about the U.S. Securities and Exchange Commission’s (SEC) perceived “lack of engagement.” Grayscale expresses confidence in the approval of spot Ether (ETH) exchange-traded funds (ETFs) in May. Grayscale’s Chief Legal Officer, Craig Salm, emphasized that the case for spot Ether ETFs. This is just as strong as it was for spot Bitcoin ETFs.

Preparation for Approval

Salm highlighted that many of the issues commonly associated with spot Ether ETFs have already been addressed in the months leading up to the potential approval. These include details regarding creation and redemption procedures, asset protection, custody, and more. Salm believes that ETF issuers have less to engage with regulators this time, given the groundwork laid during the approval process for spot Bitcoin ETFs.

While Grayscale and others are optimistic about spot Ether ETF approvals, ETF issuers seeking to incorporate staking into their products face additional challenges. These applicants, including Ark 21Shares, Fidelity, and Franklin Templeton, must address concerns with the SEC regarding staking.

Bloomberg ETF analysts Eric Balchunas and James Seyffart have expressed concern over the SEC’s perceived lack of engagement. Moreover, leading them to reduce the odds of an approved spot Ether ETF in May to 25%. Balchunas characterized this probability as “pessimistic,” suggesting that the lack of engagement may be purposeful rather than a result of procrastination.

Despite concerns, recent developments bolster the case for spot Ether ETF approvals. Salm, along with Coinbase’s chief legal officer Paul Grewal and former CFTC commissioner Brian Quintenz, view the correlation between futures and spot products as a positive indicator for spot Ether ETF approval.

Awaiting SEC Decision

Various prominent firms, including BlackRock, VanEck, ARK 21Shares, and others, are among the spot Ether ETF applicants awaiting SEC approval. The SEC must decide on VanEck’s application by May 23. In fact, analysts predictin that all applicants will learn their fate on that date.

As the deadline for SEC decisions approaches, industry stakeholders closely monitor developments in anticipation of potential landmark approvals for spot Ether ETFs.