KEY POINTS
- One source expects prospective issuers to file amended S-1 documents "pretty quickly"
- SEC Chair Gensler previously said the timeline of approval depends largely on the responsiveness of issuers
- He told lawmakers during a hearing last week that S-1 approvals may come sometime this summer
After its earlier "silence" in terms of engaging with applicants for a spot Ethereum (ETH) exchange-traded fund (ETF), the U.S. Securities and Exchange Commission (SEC) has reportedly provided comments and the applying issuers are now working to iron things out, a new report revealed.
Applicants seeking to issue the funds received comments from the regulatory agency last week, and the prospective issuers are looking to furnish their amended S-1 filings by Friday, The Block reported Tuesday, citing two unidentified sources.
One source at an applying issuer said the comments provided by the SEC were "reasonable," while another source at a separate applicant firm said the comments were "light." The second source expects potential issuers to "file [amendments] pretty quickly this week and then we'll see how many more turns of the wheel are required."
The SEC approved the 19b-4 filings of exchanges seeking to sell and trade the ETFs, but the funds won't trade unless the S-1 filings of individual issuers are approved as well.
SEC Chair Gary Gensler told lawmakers during a Senate Appropriations subcommittee hearing that he expects S-1 approvals "over the course of this summer." He said at the time that progress on the filings had been "working smoothly."
His comments during the hearing were quite contrary to what he said earlier this month, when he indicated that the full approval of spot ETH ETFs depended largely on "how responsive" the applying issuers are. He also refused to provide a timeline on the process of approvals at the time.
Senior ETF analyst for Bloomberg Eric Balchunas said he now expects the launch of spot Ethereum ETFs to take place on July 2 as he heard that SEC staff "sent issuers comments on S-1s today, and they're pretty light, nothing major."
UPDATE: we are moving up our over/under date for the launch of spot Ether ETF to July 2nd, hearing the Staff sent issuers comments on S-1s today, and they're pretty light, nothing major, asking for them back in a week. Decent chance they work to declare them effective the next… https://t.co/XJZ8JLwEFF
— Eric Balchunas (@EricBalchunas) June 14, 2024
Balchunas previously projected the S-1 greenlight to be given by the regulatory agency sometime around Independence Day on July 4. At the time, he said there could be "one more round of fine-tune comments" from the SEC before the funds are finally allowed to launch.
Nate Geraci, president of investment advisory firm The ETF Store, shared late Tuesday that Bitwise has filed amended S-1 documents. He said other applicants may also submit their amendments over the next few days.
Here come the spot eth ETF S-1 amendments...
— Nate Geraci (@NateGeraci) June 18, 2024
This one for Bitwise.
Assume others will trickle in over next few days.https://t.co/qSs6TzQVgz pic.twitter.com/df7tE8FpcU
Meanwhile, there is much buzz on X (formerly Twitter) following the SEC's decision to drop its investigation into the Ethereum network. Community liaison at blockchain platform Zach Rynes said spot Ethereum ETFs were approved under a "politically driven" movement.
It was a "monumental" development for the community not because of the fund itself but because the regulator was "forced to admit that $ETH is in fact a commodity," and not a security.
The politically driven approval of the spot $ETH ETF was monumental, not because of the ETF, but because the SEC was forced to admit that $ETH is in fact a commodity, and not a security
— Zach Rynes | CLG (@ChainLinkGod) June 19, 2024
Glad to see that has been officially validated 🫡
Gensler just can’t stop taking the L’s https://t.co/vThyA51UjI
