According to analysts at research and brokerage firm Bernstein, the approval of spot Ether (ETH) exchange-traded funds (ETFs) by the United States securities regulator was not a decision made under political pressure at the last minute.
There was speculation that the Securities and Exchange Commission’s sudden shift in attitude towards spot Ether (ETH) ETFs in May was due to increased political pressure from the Democrats aiming to secure swing voters ahead of the upcoming U.S. election. However, this theory lost credibility after President Joe Biden vetoed the SEC’s Staff Accounting Bulletin (SAB) No. 121 repeal bill, as noted by Bernstein analysts Gautam Chhugani and Mahika Sapra in a report on June 3.
The analysts highlighted that the SEC was aware of the similarities between Ether and Bitcoin ETFs, including regulatory structures and Ether’s commodity status. Despite the circumstances, the approval of spot Ether ETFs was seen as a positive outcome for the industry.
Bernstein revealed that even the applicants for spot Ether ETFs were taken aback by the SEC’s last-minute decision. While the flows for spot Ether ETFs are expected to be lower than those of Bitcoin, there is anticipated pent-up demand from similar market participants.
The firm predicts that Ether will see positive price movements leading up to its launch as an ETF. The SEC gave the green light to 19b-4 applications from various institutions like VanEck, BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK 21Shares, Invesco Galaxy, and Bitwise to issue spot Ether ETFs on May 23.
Now, the approved Ether ETF issuers are waiting for the SEC to sign off on their S-1 registration statements, a process that could take anywhere from weeks to months. The battle between the SEC and the legal firepower of the crypto industry continues, akin to Godzilla vs. Kong.