Ethereum ETF Approval May Indicate SEC No Longer Considers ETH a Security
This article briefly:
The SEC’s approval of nine Ethereum futures ETFs may indicate a shift in the stance toward ETH as a security.
· Futures ETFs are backed by CME futures contracts rather than physical assets.
Despite the approval, some industry watchers remain skeptical, arguing that the physical purchases facilitated by spot ETFs are essential.
A large number of Ethereum futures exchange-traded funds (ETFs) went live in the United States this week after the SEC approved it, marking the first listing of the asset. In addition, industry experts said that this could be a signal that the SEC is softening its stance on ETH.
On October 2, nine Ethereum futures ETFs began trading in the United States. However, initial trading volumes were low, and industry observers remain skeptical about the SEC’s approval.
Ethereum Futures ETF Marks Shift for SEC
Brian Quintenz, head of crypto policy at a16z and former CFTC commissioner, commented that the move to approve an Ethereum ETF suggests the SEC may no longer view ETH as a security.
“By approving an ETH ETF based on ETH commodity futures contracts, the SEC has formally clarified ETH’s status as a non-security.”
Futures ETFs are backed by CME futures contracts rather than physical assets. Additionally, the SEC appears willing to allow these transactions, however, it still has not approved any spot-based cryptocurrencies.
Quintenz added that with so much innovation being built on the Ethereum blockchain, “this creates a clearer path for builders,” before commenting:
“It’s ridiculous and insulting that it took this long to get here, but it’s a huge win for the cryptocurrency space and more importantly for the future of the internet.”
These comments have certainly attracted a lot of attention from Ethereum’s critics, who claim that Ethereum is a security. However, the SEC, and more importantly the U.S. Congress, have yet to make any classifications for the asset.
Tom Dunleavy, CIO of MV Capital, is not so optimistic about the launch of an Ethereum futures ETF. He added,
“The only thing that matters is that spot ETFs can facilitate spot buying because these funds need to be seeded.”
Funds must buy assets in advance, regardless of market demand and prices. “Futures ETFs do not facilitate this latent demand,” Dunleavy concluded.
ETH Price Outlook
Ethereum prices have retreated from Monday’s peak above $1,700 as markets cool again.
ETH is down 2.9% on the day, changing hands at $1,667 at the time of writing.
24 hour ETH price in USD. Source: BeInCrypto
ETH hit a monthly high on Oct. 2 but has since corrected sharply, seeking support around the $1,650 area.
Ethereum is currently down 66% from its all-time high of $4,878 nearly two years ago. #SEC #证券
