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The United States Securities and Exchange Commission (SEC) approved eight spot Ethereum ETFs (exchange-traded funds) is another historic regulatory breakthrough for the crypto industry.
The securities watchdog approved so-called Forms 19b-4 for ETF applications filed by Ark, Bitwise, BlackRock, Fidelity, Franklin Templeton, Grayscale, VanEck and Invesco Galaxy late in the day, after a rush of last minute to get them across the line. But the funds won't be able to trade until the SEC approves the applicants' S-1 filings.
“If they work extremely hard, it can be done in a matter of weeks, but there are many examples of this process historically taking more than three months,” Bloomberg Intelligence ETF analyst James Seyffart said in an article on . “Obviously this situation has nothing to do with anything that has happened historically, IMO.
Nonetheless, an SEC order approves ETH ETFs “on an expedited basis.”
BOOM!! APPROVED! Here it is. The SEC has just approved the spot #Ethereum AND F. What a turn of events. This is really happening.
h/t @PhoenixTrades_ pic.twitter.com/KQ39mDyCbT
–James Seyffart (@JSeyff) May 23, 2024
Ethereum's response was muted, with its price climbing 1.8% over the past 24 hours to trade at $3,836 as of 6:02 p.m. EST, indicating that markets had already priced in approvals.
The decision comes just over four months after the historic approval of several Bitcoin spot ETFs in January, and despite the fact that until earlier this week most analysts thought such a move was highly unlikely.
Were ETH ETF approvals a political imperative?
Some speculate that this turnaround may have been caused by political dynamics in the run-up to the presidential election.
After Republican candidate Donald Trump accepted crypto campaign donations, analysts speculated that Democrats may also need to change their anti-crypto stance. Galaxy Digital CEO Mike Novogratz told CNBC's Squawk Box in an interview earlier this week.
It appears that “someone in the Biden White House made a call and said, guys, we can't be the party against crypto anymore,” he said.
Last minute scramble
Today's announcement comes just hours after the SEC began negotiations with Ethereum ETF issuers for final adjustments to their S-1 forms, leading markets to speculate that approval was a done deal. Before the announcement, SEC Chairman Gary Gensler asked investors to “stay tuned.”
Late in the afternoon, the SEC requested a six-hour extension of the deadline as it rushed to complete the approval process.
JUST IN: SEC begins discussions with Ethereum ETF issuers for final adjustments to Form S-1.
It looks like it $ETH The ETF is a done deal. 🚀
– Alouette Davis (@TheCryptoLark) May 23, 2024
Ethereum ETFS accelerated by SEC
The SEC began speeding up the approval process earlier this week, when it asked applicants to update their filings. That prompted analysts Eric Balchunas and James Seyffart of Bloomberg Intelligence to raise the chances of approval to 75%, from “slim to none” previously.
In anticipation of imminent approval, investors purchased more than 100,000 ETH in spot markets on May 22, the most in one day since last September, according to on-chain analytics firm CryptoQuant.
Early ETH Holders Bought Over 100,000 ETH Yesterday
Julio Moreno, head of research at CryptoQuant, reported on They purchased over 100,000 ETH, the…
– CoinNess Global (@CoinnessGL) May 21, 2024
A bipartisan group of House lawmakers, including Majority Whip Tom Emmer and New Jersey Democrat Josh Gottheimer, had sent a letter to the SEC chairman yesterday, May 22, urging the SEC “to approve the Ether ETFs at the cash and “other” digital assets.
The letter stated that the investment products would provide investors with access to crypto in a regulated, transparent and safe format.
We urge the SEC Chairman @GaryGensler to approve pending Ether ETP requests. @GOPMajorityWhip @RepJoshG @USRepMikeFlood @WileyNickel
See our letter to @GaryGensler below: pic.twitter.com/uv8Sp8lqUx
– French Hill (@RepFrenchHill) May 23, 2024
Singapore-based QCP Capital earlier said that the approval of ETH ETFs could trigger a 60% increase in the price of Ethereum.
The price of Ethereum has soared nearly 45% over the past two weeks, mirroring the rise seen in the price of Bitcoin in the run-up to the approval of Bitcoin spot ETFs in January.
GeckoTerminal: ETH/USD 1-day chart
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