Hong Kong has opened doors to a historic first: spot Bitcoin and Ether ETFs. However, across the Pacific, the US regulatory landscape paints a different picture, casting a shadow over hopes for similar approval. Talks between US issuers and the SEC regarding Ether-linked ETFs have left a sense of unease, with sources hinting at potential rejection.
One-Sided Discussions Raise Concerns
Despite the participation of major players like VanEck and ARK Invest, discussions haven’t mirrored the robust back-and-forth witnessed during Bitcoin ETF deliberations. Sources at Reuters report these talks as “one-sided,” lacking the depth of previous engagements. This shift in the SEC’s approach has fueled apprehension among issuers who point to similarities between Ether and approved Bitcoin ETFs, as well as Ether futures-based ETFs. However, the SEC remains tight-lipped on specific concerns, creating an atmosphere of uncertainty.
Delays Seem Likely, Dampening Enthusiasm
Analysts predict potential delays, with the market already reflecting this skepticism. While Ether has seen impressive growth (39% YTD), it falls short of Bitcoin’s rise (51%). This disparity underscores the regulatory uncertainty surrounding Ether’s adoption as a mainstream investment vehicle. VettaFi analyst Todd Rosenbluth foresees delays extending well into 2024, while Bloomberg’s Eric Balchunas puts the odds of May approval at a meager 35%.
Also Read: Spot Ether ETF Approval in May? Crypto Market Maker GSR Lowers Odds Significantly
Silence Speaks Volumes: Issuers Consider Options
The limited discussions, primarily focused on data observation, highlight the SEC’s cautious approach. This suggests that approval might hinge on unforeseen market developments. Furthermore, the lack of substantive dialogue leaves issuers contemplating potential legal challenges in case of rejection.
The current situation paints a picture of regulatory ambiguity, leaving both issuers and investors yearning for clarity from the SEC. While Hong Kong embraces innovation, the US remains hesitant, keeping the door to Ether ETFs firmly shut – for now. The coming weeks and months will be crucial in determining the fate of Ether ETFs in the US and whether the regulatory landscape will adapt to accommodate this new wave of cryptocurrency-based investment opportunities
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