Gary Gensler, the Chair of the United States Securities and Exchange Commission (SEC), disclosed during an appearance on CNBC’s “Squawk Box” that the approval process for spot Ether (ETH) exchange-traded funds (ETFs) will require a considerable amount of time, according to the federal regulator.
What’s Next For Spot ETH ETF Approval?
Gensler’s statement could suggest the possibility of approving the S-1 forms for all spot ETH ETF candidates. The S-1 form, also known as the initial registration form mandated by the SEC, is a prerequisite before these products can be fully accessible to the public.
On May 23, the SEC granted approval for the 19-4b forms submitted by several spot ETH ETF applicants, including VanEck, BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK 21Shares, Invesco Galaxy, and Bitwise. This decision by the federal regulator marked a notable shift in circumstances after weeks of declining approval prospects. It also comes just a few months following the approval of spot Bitcoin (BTC) ETFs under Gensler’s leadership.
Critics have closely examined the SEC chair for his persistent skepticism towards crypto and his tendency to regulate through enforcement when it comes to digital assets.
In a statement issued in January 2024, shortly after the approval of spot BTC ETFs, Gensler cautioned investors about the multitude of risks associated with bitcoin and assets linked to crypto.
In a recent interview with Rachel Wolfson, James Seyffart, an ETF analyst at Bloomberg, asserted that the approval of ETH was “a purely political decision,” especially in light of the growing bipartisan support for crypto-friendly policies leading up to the 2024 U.S. presidential election.
Seyffart further commented, “We believe it represented a significant shift in stance by the SEC.”
SEC Chair Gary Gensler Lays Into Crypto Sector On Live TV
During his appearance on CNBC, Gensler did not refute Seyffart’s assumption, instead, he heavily criticized the digital asset sector. He expressed concerns about crypto exchanges, highlighting practices that would not be tolerated on traditional exchanges like the New York Stock Exchange.
Gensler emphasized the lack of proper disclosures for digital asset investors, describing the current situation as “suboptimal” for them. Furthermore, he questioned the credibility of the digital asset industry by pointing out the incarceration or impending legal actions against key figures within the sector.
He potentially referenced individuals like Sam Bankman-Fried of FTX, Changpeng ‘CZ’ Zhao of Binance Labs, and Do Kwon of Terraform Labs, suggesting that their legal issues undermine the industry’s integrity.
Despite Gensler’s strict stance, many within the crypto community believe that the SEC’s approval of spot ETH and BTC ETFs could pave the way for increased mainstream adoption of digital assets in the United States.
