As the countdown to the SEC’s final decision on Ether ETFs ticks away, the silence from the United States Securities and Exchange Commission (SEC) becomes increasingly ominous. With each passing day, the prospect of a green light for Ether exchange-traded funds (ETFs) dims, according to Eric Balchunas, a seasoned ETF analyst at Bloomberg. The current landscape paints a bleak picture for Ether enthusiasts hoping for a breakthrough by May, with the SEC’s lack of feedback to fund issuers signaling potential trouble ahead.
In an engaging discussion with Cointelegraph, Balchunas shared his insights, revealing a significant drop in confidence for the approval of Ether ETFs — now pegged at a mere 35%. The alarming countdown, now at 73 days from the deadline without a peep from the SEC, sets a foreboding tone.
“The absence of dialogue or feedback from the SEC is a red flag,” Balchunas remarked, underscoring the importance of regulatory engagement in the lengthy ETF approval process.
Balchunas also pointed to “intel” hinting at a deliberate silence strategy by the SEC towards ETF hopefuls, further complicating the approval landscape. He highlighted SEC Chair Gary Gensler’s perspective on Ether as a pivotal factor, suggesting Gensler’s hesitation to navigate the political aftermath experienced with past Bitcoin ETF approvals and the SEC’s legal battle with Grayscale in August 2023.
Amidst the uncertainty, Balchunas sensed an unusual reversal in the ETF approval process for Ether compared to the Bitcoin ETF race. Despite this intuition playing a minor role in his analysis, he considered it a significant influence on his perspective.
Adding to the complexity, the ETF Store’s Nate Geraci and Consensys’ Matt Corva shared their observations on the peculiar regulatory path of Ether ETFs. Geraci pointed out the oddity of the SEC’s approval of ETH futures ETFs in October, with no follow-through on spot products by May. Corva, on the other hand, suggested that a potential denial of an ETH ETF could, paradoxically, serve as a positive turning point in the broader crypto landscape.
On March 6, pivotal meetings between crypto giants Coinbase, Grayscale, and SEC officials hinted at progress, yet Bloomberg’s Balchunas leans on VB Capital’s Scott Johnsson’s analysis, casting doubt on an approval. Johnsson’s focus on the correlation between ETH and BTC futures versus spot prices as a determinant for ETF fate suggests a challenging road ahead.
With the looming U.S. presidential election on November 5 serving as a critical juncture, Balchunas anticipates potential shifts in the SEC’s leadership and strategy post-election. Despite the hurdles, he remains optimistic about the eventual approval of a spot Ether ETF, emphasizing the inevitability of progress with time.
As the Ether ETF saga unfolds, stakeholders and observers alike remain on edge, awaiting the SEC’s verdict. The intricate dance between regulatory oversight, political dynamics, and market anticipation continues, with the future of Ether ETFs hanging in the balance.
