Investment bank TD Cowen has updated its forecast on when the United States might approve a spot Ethereum exchange-traded fund (ETF). It is now expected to happen around late 2025 or early 2026. Earlier, the bank had suggested that approval might come after the November 2024 election.
According to the TD Cowen Washington Research Group, led by Jaret Seiberg, the delay in approving a spot Ethereum ETF is more about politics than finance. The group believes that SEC Chair Gary Gensler is unlikely to approve such an ETF soon, especially considering the adverse reaction from progressive Democrats to the SEC’s recent approval of a spot bitcoin ETF.
Gensler, needing the support of progressive groups for his current agenda and potential future roles, is seen as unlikely to risk controversy by approving an Ethereum ETF. TD Cowen suggests that Gensler prefers to wait and see how the recently approved spot Bitcoin ETFs perform before moving forward with an Ethereum ETF.
Several companies, including big names like BlackRock and Fidelity, have applied for a spot in Ethereum ETF. The SEC has repeatedly delayed its decision on these applications, including the one from Grayscale Investments. TD Cowen explains that the SEC can take its time to review these applications and may either reject them or face further delays due to new applications or potential litigation.
The bank also mentioned that the expected timeline for approval remains the same, even if Congress doesn’t pass broader legislation on the crypto market structure in 2025. This forecast aligns with the end of Gensler’s term in June 2026.
The crypto community’s expectations regarding approving a spot ether ETF remain divided. While some experts are hopeful for an early approval, possibly by May – the initial deadline for approving such funds – others share TD Cowen’s view of a later approval date.
