U.S. Securities and Exchange Commission (SEC) Chairman Gensler said on Wednesday that when a spot ETF tied to the cryptocurrency Ethereum will begin trading will largely depend on how quickly the issuer responds to the SEC's inquiries.
The SEC last month approved applications from Nasdaq, CBOE and NYSE to list spot Ethereum ETFs, a surprise win for the cryptocurrency industry, which had expected the SEC to reject the applications after meetings with regulators.
Before an ETF can begin trading, the SEC must still approve the ETF issuer’s registration statement, which details disclosures to investors. This process typically involves a lot of correspondence between the ETF issuer and SEC officials.
"These registrants will proactively respond to the comments they receive, but the extent of their response is really up to them," he said. Gensler declined to say whether he thought the process would take weeks or months.
Gensler and SEC officials have not previously commented on why the SEC made a U-turn and approved the application for a spot Ethereum ETF, but he said on Wednesday that a lawsuit filed by Grayscale last year forced the SEC to approve a spot Bitcoin ETF in January, which affected the SEC's view on Ethereum.
Grayscale successfully argued at the time that the SEC had previously approved an ETF tied to Bitcoin futures, so it should also approve a spot Bitcoin ETF because Bitcoin futures prices are highly correlated with spot prices.
Gensler said the cases are similar because the futures Ethereum ETF has been trading since last year. SEC staff "looked at the filings and looked at various correlations... that were relatively similar to the correlations in the Bitcoin space."
The SEC approved the spot Bitcoin ETF in January after the court ruled in Grayscale’s favor last year. Gensler acknowledged the court’s decision in a statement at the time, adding that he believed approving the products was the “most sustainable path forward.”
For a decade, the SEC had rejected bitcoin ETFs. “But the courts ruled otherwise,” Gensler said. “We adjusted.”
However, he added that he still believes the cryptocurrency space is “rife with fraud, scams, and conflict.”
The article is forwarded from: Jinshi Data
