The US Securities and Exchange (SEC) approved plans by the New York Stock Exchange, Chicago Board Options Exchange (Cboe), and Nasdaq for a spot Ethereum ETF. The move removed a key obstacle to Ethereum spot trading in the US, but the SEC has yet to issue full approval for spot Ethereum ETFs, and approval of the issuer plan is still required.

According to reports, the SEC has approved Form 19b-4 for several spot Ethereum ETFs, including BlackRock, Fidelity, and Grayscale ETFs. Although these forms have been approved, ETF issuers need their S-1 registration statement to take effect before they can begin trading. The SEC has only recently begun talks with issuers about their S-1 forms, and it's unclear how long this process will take.

In other words, issuers now require separate approval from regulators, and no deadline has been set for this decision.

Analyst James Seyffart said, “I think if they work really hard, it could be done in a few weeks, but there are plenty of examples in history where this process took more than 3 months.”

Investment firms including VanEck, ARK Investment Management (ARK Investment Management), BlackRock Inc. (BlackRock Inc.), and Fidelity Investments (Fidelity Investments) are all vying for a key first-mover advantage in launching an in-stock Ethereum ETF. Since the SEC approved spot Bitcoin ETF transactions in January of this year, billions of dollars have poured into new Bitcoin ETFs, which has piqued their interest.

Coinbase shares rose 4.1% in Thursday's after-hours trading, while Robinhood's shares rose nearly 3%. The cryptocurrency market's reaction to this news was relatively lackluster. Ethereum traded at around $3819.80 as soon as the news was released.

In addition to ETFs, the SEC's announcement on Thursday also had an impact on US monetary policy. SEC Chairman Gary Gensler (Gary Gensler) has always been ambiguous about whether Ethereum is a security, which has fueled concerns about the agency's toughening position. Cryptocurrency enthusiasts say they are concerned that he is trying to get Ethereum and projects that may be based on the Ethereum blockchain to accept the agency's tough, expensive, and cumbersome investor protection rules.

Meanwhile, the Commodity Futures Trading Commission (CFTC), another major US market regulator with jurisdiction over derivatives, has stated that it does not consider Ethereum a security. The CFTC has allowed CME Group Inc. (CME Group Inc.) to trade Ethereum futures for many years.

A major victory

Just last week, some companies were still worried that the SEC would veto CBoE's plan before Thursday's deadline, and possibly others. While issuers are still subject to additional approval from the SEC, this is a major win for the industry as a whole.

Proponents hope that the listing of a spot Ethereum ETF will attract retail and institutional investors who are interested in cryptocurrencies but prefer to invest in ETFs rather than tokens, thereby bringing a new flood of capital to the asset class.

Overall, many investors who retreated after the FTX exchange crashed have re-entered the cryptocurrency sector. Due to this boom, Ethereum, the native token of the Ethereum blockchain, has risen by more than 60% this year alone. Goldman Sachs and Bernstein (Bernstein) point out that in the long run, Ethereum's upside may be far greater than Bitcoin's.

This rise is partly due to optimism that US pressure on the industry may be waning. The Republican-led House of Representatives advanced comprehensive cryptocurrency legislation on Wednesday despite opposition from the White House and Gensler. Although the Senate is not expected to approve the measure, it has received support from some Democrats in the House of Representatives.

On the issue of jurisdiction, Lee Reiners, head of policy at Duke University's Duke Financial Economics Center (Duke Financial Economics Center), said that the reason the exchange requested the listing of these products was that Ethereum is a commodity, not a security. He said the SEC's decision to give the green light to the plan supports the view that the SEC still sees Ethereum as not a security.

Investment firms seeking to list their products have made concessions to win approval from the SEC. Fidelity Investments said it will keep Ethereum purchased as part of the ETF outside of projects that pay rewards for blockchain maintenance. These projects are known as staking (staking). The latter has always been a hot issue for Ethereum, as it raises questions about whether the token should be considered a security. Last year, the SEC charged in a lawsuit that Coinbase Global Inc.'s provision of staking services violated SEC regulations.

All in all, the market is now waiting for various Ethereum ETF issuers to make adjustments based on the latest clarifications and get S-1 approval as soon as possible, ultimately giving the green light to the deal. Vaneck was the first company to apply for a spot Ethereum ETF, and they have submitted amendments to the S-1 file without hesitation.

Editor/Somer