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Highlights
- Bitcoin maxis are having strong meltdown over SEC's 18-degree turn on spot Ethereum ETF.
- Sources said Biden admin. to gain advantage if spot Ether ETFs are approved.
- Coinbase CLO says that the current bill challenges SEC's flawed Howey Test.
In recent days, Ethereum (ETH) and the wider cryptocurrency markets have surged amid anticipation of the spot Ethereum ETF gaining approval this week. The Ethereum price skyrocketed above $3,800, marking over 30% gains in just the last two days. However, questions arise regarding the US SEC’s swift handling of the 19b-4 filings. Speculation suggests that the decision to expedite the spot Ethereum ETF approval process may have more political motives than regulatory considerations.
Spot Ethereum ETF at the Center of U.S. Politics
Until last week, the US SEC was not willing to engage with the issuers on the spot Ethereum ETF, however, it has suddenly taken a 180-degree turn this week.
“It is a completely unprecedented situation, which means it’s entirely political. They’re not even internally coordinated yet, which is why this is most likely a political decision,” noted Sarah Wynn from The Block.
Other sources also stated that with the U.S. Presidential elections approaching later this year, this could be politically motivated as well. The Biden reputation through the years has built its reputation for cracking down on the crypto market.
On the other hand, former President Donald Trump has undertaken a pro-crypto stand and is willing to accept donations in crypto. “The problem is that the Democrats urgently need young voters to turn out for them. Biden’s campaign strategy is focused on presenting himself as a forward-looking octogenarian,” the source stated. The source added that President Joe Biden could gain an advantage if the SEC approves spot Ether ETFs.
EVERYTHING HAS CHANGED.
Democrats pushed back against Biden and Warren and voted for crypto.
The FDIC chair that Warren was privately protecting and who orchestrated Chokepoint 2.0 is stepping down.
The ETH ETFs are likely to be approved now as a result of the tide change.…
— The Wolf Of All Streets (@scottmelker) May 21, 2024
Expert’s Take on the Matter
Some of the crypto industry experts believe that the SEC’s 180-degree shift this week isn’t entirely politically motivated. Nate Geraci, the President of ETF Store, said that the SEC was always preparing for the approval of spot Ethereum ETF. The securities regulator approved Ether futures ETF last October 2023, from ProShares, VanEck and Bitwise, thereby setting the stage for spot products.
My theory on SEC waiting until last minute to engage w/ exchanges & issuers on spot eth ETFs…
I think politics played a very minor role here, if any.
via @ForTheWynn_ pic.twitter.com/IOZQOJPNBA
— Nate Geraci (@NateGeraci) May 21, 2024
“Once the SEC approved ether futures ETFs, that likely sealed the fate of an approval outcome for spot ether ETFs,” Geraci said.
On the other hand, some Bitcoin maximalist have been having a real meltdown on the SEC considering a spot Ethereum ETF approval. Popular Twitter handle, The Bitcoin Therapist noted:
If the SEC approves an Ethereum ETF it will be an indication the market is not regulated by competent actors. Ethereum is literally a speculative platform for gambling on centralized shitcoins. This will pave the way for a shitcoin casino embedded into the SEC.
Paul Grewal, Chief Legal Officer at Coinbase, asserts that the current bill challenges the SEC’s recent assertion that all cryptocurrencies, except Bitcoin, meet the Howey Test criteria for securities.
Grewal emphasized that this bill does not dismantle the industry but rather addresses what he considers a flawed regulatory perspective.
Note that there’s no clear timeline for the approval of spot Ether ETFs. However, the current developments suggest that they could be arriving by late July or early August.
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