My Crypto Lawyer
For years, the crypto community has been gripped by the question of when the Securities and Exchange Commission (SEC) will approve a spot Bitcoin (BTC) exchange-traded fund (ETF) and – among the more inclined toward cynicism – what reason they will find to reject the applications.
January 2024, however, brought a significant advancement – though it has been driven by a precedent-setting decision of the Court of Appeals – and saw the approval of 9 spot BTC ETFs opening the next stage in institutional adoption and legal recognition: the matter of similar fund for the world’s second-biggest cryptocurrency, Ethereum (ETH).
Indeed, multiple major issuers have filed their applications with the SEC, but most recent reports based on a meeting with the regulator indicate that it is generally expected no ETH ETFs will be approved in May.
No ETH ETF in May as SEC continues pattern of postponements
Though neither final nor guaranteed – the SEC is expected to reach a decision on VanEck’s application on May 23 and on ARK Investment Management’s one day later – the predicted rejections fall in line with an earlier consensus.
Indeed, several weeks ago, on April 9, Jan van Eck, the CEO of VanEck, joined other issuers in expressing a belief that the SEC would reject the proposed Ethereum ETFs.
Still, the companies have stated their intent to file additional disclosure paperwork with the hopes of keeping the discussions lively.
For its part, the SEC has continued with a pattern – previously observed with pending BTC ETFs – of continuous postponements.
As recently as April 23, the regulator announced that it is moving the decision date for Franklin Templeton’s application to June 11 and Grayscale’s to June 23.
In fact, the decision on VanEck’s spot Ethereum ETF application – the next one on the chopping block – has itself been postponed until late in March, with the new date set for May 23.
SEC in hot water over crypto regulation
At the same time, a Utah judge has seemingly agreed with a common criticism levied against the SEC by the crypto community – that the watchdog is overly heavy-handed, unfair, and prone to misrepresenting the industry.
In fact, in a March ruling, Judge Robert Shelby decided to sanction the Commission over its handling of a case against DEBT Box – a case marred by a lack of evidence, misrepresentation and false statements.
The decision prompted two agency lawyers – Michael Welsh and Joseph Watkins – to resign after allegedly getting warned that they would be fired otherwise.
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