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SEC Chair Gary Gensler Optimistic About US Spot Ether ETFs as Analysts Eye Early July Launch

Last Updated June 26, 2024 1:01 PM
Teuta Franjkovic
Last Updated June 26, 2024 1:01 PM

Key Takeaways

  • Gensler has spoken on the progress of the first spot Ether ETFs, emphasizing the importance of comprehensive disclosures by asset managers.
  • The US crypto industry has lobbied to make digital assets a significant election issue.
  • Brad Garlinghouse criticized Gensler for his comments on crypto regulation and the SEC’s delays in approving BTC ETFs.

The launch of the first spot Ether (ETH) exchange-traded funds (ETFs) in the United States is progressing well, according to  Securities and Exchange Commission Chair Gary Gensler.

During a Bloomberg conference on June 25,  Gensler was non-committal about the exact timing of the ETF launch and did not specify if they would be available before the November US elections.

SEC’s Gensler: Thorough Disclosure Key to Approving Bitcoin ETFs

Gensler emphasized  that the crucial factor is ensuring asset managers provide comprehensive disclosures for the registration statements to become effective.

Gensler stated :

“What is in front of us — and it’s done at a staff level — is what’s called the registration statements, the disclosure statements,” Gensler added. “Again, these disclosures are really important. They’re important to investors making investment decisions.”

On May 23, the SEC approved 19b-4 filings from eight ETF applicants, but the asset managers are still refining their Form S-1 filings, which are the final documents the SEC needs to approve before trading can commence. Analysts have suggested  that the SEC could greenlight these funds for trading as early as next week, the first week of July.

 

Eric Balchunas, an ETF analyst at Bloomberg, has reiterated his forecast  for a July 2 launch date for spot ether exchange-traded funds (ETFs). This prediction follows a notable increase in amended S-1 (registration statement) filings by issuers.

On the other hand, Markus Thielen, CEO of 10X Research, recently shared  a detailed analysis on social media regarding the potential market implications of the upcoming US Spot Ethereum ETF. Thielen suggests that the Ethereum ETF could be launched imminently,”any day now”, but potentially by July 2, mirroring the timeline seen with Bitcoin ETFs.

He highlighted that VanEck, a prominent figure in the ETF arena, filed a form 8-A recently—a procedural step that occurred just days before the launch of their Bitcoin ETF. Following its introduction, VanEck’s Bitcoin ETF rapidly amassed $600 million in assets under management (AUM).

Crypto Industry Fights Back Against SEC Enforcement, Making Digital Assets an Election Issue

In response to a series of enforcement actions from the SEC led by Gary Gensler, the US crypto industry has invested millions and lobbied to make digital assets a prominent election issue.

Presidential candidate Donald Trump promised to terminate what he termed President Joe Biden’s “war on crypto,” while billionaire investor Mark Cuban warned that Gensler’s approach could jeopardize Biden’s chances in the election.

Gensler, when questioned about the remarks from Trump and Cuban, chose not to comment on election-related topics.

Instead he commented :

“We have a set of rules that are pretty clear. There’s nothing inconsistent about crypto securities and the securities laws. Unfortunately, there’s a number of people that are non-compliant with the laws.”

Gensler Criticizes Crypto Tokens for Lack of Disclosure, Garlinghouse Responds

Gensler noted that there are approximately 20,000 crypto tokens he considers investment contracts, a classification that would make them securities under US law, and criticized these tokens for not providing adequate disclosure to American investors.

He pointed out that many prominent figures in the crypto industry from recent years are either in jail, facing imminent imprisonment, or awaiting extradition.

He added:

“We’re bringing that in front of courts, and those will play out because folks that are not complying with the law hurt the American public.”

Ripple CEO Brad Garlinghouse criticized  Gensler’s comments on X, calling them “absolute nonsense” and accusing the SEC chief of “completely missing FTX.”

Previously, Garlinghouse labeled Gensler a “political liability,” criticizing his regulatory approach to the crypto industry. He highlighted the SEC’s long delays in approving spot Bitcoin exchange-traded funds and pointed to high-profile lawsuits against companies like Ripple during Gensler’s tenure.

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