Grayscale Remains Optimistic About Ether ETF Approvals Despite SEC’s Limited Involvement

Grayscale remains confident that the U.S. Securities and Exchange Commission (SEC) will approve spot Ether exchange-traded funds (ETFs) in May, despite concerns about the regulator’s lack of engagement with applicants. Craig Salm, Grayscale’s Chief Legal Officer, stated that he does not believe the perceived lack of engagement should be seen as an indication of the outcome. Salm expressed his confidence in the approval of the ETFs and explained that many of the issues related to spot Ether ETFs have already been resolved, based on the experience with spot Bitcoin ETFs. However, ETF issuers who want to incorporate staking into their spot Ether ETFs would need to address this issue with the SEC. The applicants for spot Ether ETFs include Ark 21Shares, Fidelity, and Franklin Templeton. Bloomberg ETF analysts Eric Balchunas and James Seyffart have expressed concerns about the SEC’s lack of engagement and have lowered the odds of an approved spot Ether ETF in May to 25%. They believe that the lack of engagement is intentional rather than a result of procrastination. Despite this, Salm believes that the recent approval of Ether Futures ETFs and the regulation of these products as commodity futures position spot Ether ETFs well for approval, as futures and spot products have a high correlation. Other prominent applicants for spot Ether ETFs include BlackRock, VanEck, Invesco Galaxy, and Hashdex. The SEC must make a decision on VanEck’s application by May 23, and it is predicted that all applicants will learn their fate on that date.