Ethereum
US SEC Approves Exchange Applications to List Ethereum Spot ETFs; the token drops by 5%
The U.S. Securities and Exchange Commission (SEC) on Thursday approved applications from Nasdaq, CBOE and NYSE to list exchange-traded funds (ETFs) linked to the price of Ethereum (ether), potentially opening the path to further trading of crypto products. This year.
Although ETF issuers must also get the green light before the products can launch, the latest approval is a major surprise victory for these companies and the cryptocurrency industry, which has been expecting the SEC rejects deposits. Before this, Bitcoin ETFs were already approved in January this year, sparking renewed interest in the crypto space.
Nine issuers, including VanEck, ARK Investments/21Shares and BlackRock, are likely to launch ETFs tied to the second-largest cryptocurrency, Ethereum, after the SEC approved Bitcoin ETFs in January, a watershed moment for the industry. Market players see this as an important step towards commercialization of products.
The US SEC’s approval of Ethereum spot ETFs following Bitcoin spot ETFs marks a significant advancement in the crypto market, improving access and liquidity for investors. Institutional investors can now benefit from a regulated exposure route, promoting broader market participation. This milestone indicates growing regulatory acceptance of cryptos, said Edul Patel, CEO of Mudrex.
“After Hong Kong and the United States, it is likely that many other countries will follow suit by approving Bitcoin and Ethereum spot ETFs. Such approvals can boost investor confidence, drive market growth and encourage further innovation in the sector, ultimately leading to a more robust and mature global financial landscape,” he said.
Thursday’s decision was nothing short of a surprise as it was the deadline for the SEC to rule on VanEck’s case. Market participants were bracing for rejection because the SEC had not engaged with them on the applications.
The exchange applications had sought SEC approval for a rule change needed to list new products, but issuers still need the SEC to approve ETF registration statements detailing information provided to investors before to be able to start negotiating.
The green light from the US Securities and Exchange Commission (SEC) for spot Ether ETFs is a big moment for the crypto industry. It builds on the success of Bitcoin ETFs, providing investors with a secure and regulated way to access Ether. This broader acceptance will fuel mainstream adoption and reflects a maturing regulatory environment, said Sumit Gupta, co-founder of CoinDCX.
“Ethereum’s classification as a security could have significant ramifications for the Web3 industry. Ethereum is the foundation of a large ecosystem of decentralized applications (dApps) and Web3 projects. It is expected that an ETF spot Ether (ETH) could lead a rally in the asset class to new highs,” he said.
However, despite the positive news, Ethereum fell by around 5% in the last 24 hours to $3,655 as of 1:30 p.m. IST. The total market capitalization of Etheruem stood at just over $440 billion, while the total market capitalization of all crypto assets during the same period stood at $2.5 trillion.