In an exclusive interview with Cointelegraph on February 23, Kevin de Patoul, CEO of Keyrock, a digital asset market maker, expressed his opinion that the approval of spot Ether exchange-traded funds (ETFs) is still uncertain and not guaranteed. Although Ether (ETH) ETFs have garnered significant attention in the cryptocurrency industry, with Bernstein, a wealth management firm, suggesting that Ether may be the only cryptocurrency to receive an ETF this year, de Patoul believes that there are still challenges to overcome before approval is granted. Similar to the difficulties faced in approving the first spot Bitcoin (BTC) ETFs in the United States, de Patoul anticipates obstacles in the path of Ether ETF approval.
One major concern is the classification of Ether as a security by Securities and Exchange Commission (SEC) Chair Gary Gensler. While Gensler has not explicitly stated whether he considers Ether to be a security risk, former SEC Division Director William Hinman dismissed this notion in a 2018 speech. De Patoul asserts that Ether does not meet the criteria of a security; however, he acknowledges that the introduction of staking yield, which occurred after Ethereum’s transition to a proof-of-stake consensus model last year, may present a different perspective from the SEC’s point of view.
Interest in Ether ETFs was reignited after Ether surpassed the psychological price level of $3,000 on February 20, reaching a price not seen in 22 months. De Patoul attributes Ether’s recent price surge to a combination of factors, including the anticipation of a potential spot ETF and the upcoming Dencun upgrade.
While there are varying opinions and predictions regarding the likelihood of an Ether ETF approval, with JPMorgan estimating a 50% chance by May, Bloomberg senior ETF analyst Eric Balchunas forecasting a 70% chance, and Polymarket odds indicating a 42% chance by the end of May, the final decision remains uncertain.