SEC gives green light for Ethereum ETFs – but without staking – BitcoinBlog.de – the blog for Bitcoin and other virtual currencies

Now what everyone had expected happened surprisingly early: The US Securities and Exchange Commission (SEC) approved all registered spot Ethereum ETFs.

The SEC’s ruling approves the applications of Nasdaq and CBOE, the two major stock exchanges in New York and Chicago, to trade a series of new ETFs:

• den Grayscale Ethereum Trust,
• the Bitwise Ethereum ETF,
• den iShares Ethereum Trust (Blackrock),
• the VanEck Ethereum ETF,
• the ARK 21Shares Ethereum ETF,
• den Ivesco Galaxy Ethereum ETF
• den Fidelity Ethereum Fund,
• the Frankling Ethereum ETF

Basically, it is almost the same providers as with the Bitcoin ETF who have been given the green light to launch the same product based on Ethereum: “After careful review, the Commission recognizes that the proposals are compliant with the laws and regulatory requirements and are therefore applicable to the national stock exchanges.” It is therefore to be expected that the Ethereum ETFs will appear on the US stock exchanges in the near future.

However, one of the greatest potentials of Ethereum ETFs fell by the wayside along the way: staking. ARK and Fidelity, for example, had planned to stake the Ether they use to cover the ETF and distribute the income generated as dividends. However, after the skeptical reaction of the SEC, they dropped this plan.

The reasons for this are not entirely clear. Possibly because earning dividends would make Ethereum a security, which would probably make the approval of an ETF difficult or even impossible. The current approval is explicitly tied to the requirement that Ethereum is not a security, but – as with Bitcoin – a “commodity”, i.e. a type of raw material.

The Ethereum ETF approved in Hong Kong also does not yet include staking. However, the regulator there is currently considering allowing staking for the ETFs. This would be a milestone for crypto ETFs in general.

The price of Ethereum has risen significantly following the news. Rumors of an impending approval were already spreading at the beginning of the week, causing the price to rise from just over $3,000 to more than $3,700. Shortly before the approval, it reached a high of almost $4,000 – the news had probably already leaked out – but has been trending downwards since then and is currently trading at just under $3,700. Nevertheless, Ethereum has gained around 20 percent compared to Bitcoin – from 0.046 to 0.055 BTC.

Despite this inherently favorable price action, Bitcoin or crypto lawyer Gabriel Shapiro asks why Ethereum isn’t “shooting to the moon” after ETF approval. One reason is that approval isn’t final yet – only a 19b-4s is approved, not an S-1s – meaning an SEC commissioner can still block approval over the next 10 days. Shapiro speculates that this is a horse-trading exercise, trading a pro-crypto SEC decision for ESG rules that are hoped to be in place before July 1, before Donald Trump can potentially challenge them.

He sees the approval as “a political step forward for crypto” without the ETF being a done deal yet. Shapiro doubts whether this will ever happen, but is relatively alone in this pessimism. Regardless of the final approval, the question of whether Ethereum is a security is finally off the table. This alone is a huge relief for Ethereum.