US Regulators Target July 4

On Jun 27, 2024

Two executives close to the discussion around Ether ETFs and a lawyer of one of the issuers have assured that the launch could take place in a week or two.

According to reports, the process of amending the documents has reached an advanced stage with just the “finishing touches” needed to get ready.

The 19b-4 forms tied to the spot Ethereum (ETH) Exchange-Traded Funds (ETFs) were recently approved for American exchanges pending the official approval of S-1 forms for trading. As Crypto News Flash explained, the SEC’s statutory period for the approval of the S-1 forms has an extension period of up to 240 days. Also, the 19b-4 form approvals do not guarantee an S-1 form greenlight.

With all of these possibilities confronting the applications, market insiders have hinted that the approval could be made as soon as July 4 as asset managers and regulators enter an advanced or final stage of discussion. The prospective issuers who submitted the S-1 forms include BlackRock, Fidelity, Grayscale, VanEck, Franklin Templeton, Ark/21Shares, and Invesco/Galaxy. Also, most of these companies amended their submissions to remove the provisions of Ethereum staking.

Per our investigation, two executives close to the case have disclosed that amending the documents has progressed to resolving trivial issues. Reuters also claimed to have spoken to a lawyer of one of the issuers and believed the approval would be announced in a week or two.

🚀 Big news for crypto enthusiasts! The SEC is on track to approve a spot #Ethereum ETF by July 4th. According to Reuters Final tweaks underway, launch imminent! 🌐💼 #Ethereum #ETF #CryptoNews pic.twitter.com/lvPvChRAIv— Collin Brown (@CollinBrownXRP) June 27, 2024

More on the Potential Approval of the Ether ETFs

Weeks ago, SEC chair Gary Gensler disclosed that the registrants involved in the process are “self-motivated to be responsive to the comments they get.” However, the pace of development largely depends on the issuers’ responsiveness.

A few days or weeks before the official launch, Binance CEO Richard Teng expressed his excitement about the impact of this historic move and how it cements Ethereum’s legitimacy as an asset.

Capital deployment for the spot Ethereum ETFs would likely be constant, steady and not dramatic. This has been the case with the US Bitcoin Spot ETFs, which brought in over $13.3B in inflows within the first five months, and we can expect the same trajectory in this case too. We are optimistic that this latest step forward will lead to further regulatory acceptance, paving the way for more mainstream adoption of digital assets globally — be it for ETH, BTC, or others. As digital assets continue to become a mainstay within the future of finance, #Binance is excited to be part of this transformative era.

Regardless of this massive development, the price of ETH remains bearish. It declined by 0.56% in the last 24 hours and 5% in the last seven days to trade at $3,370.

However, Ryan Grace, the head of IG-owned tastycrypto, believes that the potential approval could drive new money into the asset and subsequently push the price upwards.

We could see a price squeeze given the illiquid ETH supply. Around 30% of the supply is staked, and while it could be unstaked, ETH is used in DeFi etc., and the supply is not super liquid vs potential demand flows. Essentially, ETH ETF gives institutions a way to ‘diversify’ their crypto allocation. I’m not expecting there to be as big of an inflow as we saw in the BTC ETFs initially, but maybe we see assets under management approach 50% of BTC ETFs within 6 months.