As an experienced analyst, I have closely followed the development of Ethereum Spot ETFs in the United States. After the quick approval of 19b-4 filings in May, I had projected a potential launch date of July 2 based on the SEC’s swift response to the first round of comments. However, the recent delay in the SEC’s second round of responses has forced me to reconsider my prediction.
According to Bloomberg analyst Eric Balchunas, the anticipated debut of Ethereum Spot ETFs in the US market has been revised due to recent remarks from the Securities and Exchange Commission (SEC) regarding the second submission of their S-1 forms.
S-1 Forms Receive Late Response From SEC – Details
In May, the SEC abruptly approved the 19b-4 filings from eight prospective issuers of the Ethereum spot ETF, clearing the first step for the eventual introduction of these investment funds. In line with US regulations, the Commission is also expected to greenlight the S-1 forms of these proposed ETFs before trading can commence. For context, the S-1 forms contain information on an ETF’s investment objectives, strategies, risks, fees, etc.
After the initial submission of S-1 forms by all involved parties on May 31, the SEC provided relatively few comments in response. Consequently, those issuers were required to submit the necessary amendments within a week.
As an analyst, based on Eric Balchunas’ assessment of the Commission’s quick approval process, I proposed a potential launch date for the Ether spot ETF as July 2. However, the SEC has taken longer than expected to respond in their second round of comments, with requests described as merely “light tweaks.”
Based on recent progress and with the US Thanksgiving holiday coming up next week, during which there will be minimal work activity, Balchunas anticipates that work on the S-1 forms will resume on July 8, followed by a swift approval process.
Unfortunately, we’ll need to postpone our over/under discussion until after the upcoming holiday. It seems the SEC has taken longer than expected to respond to people this week (though the changes were minimal once again). The next week is reportedly quiet due to the holiday on July 8th. After that, the process is set to resume and the launch should follow soon after.
— Eric Balchunas (@EricBalchunas) June 28, 2024
As a researcher studying the differences between securities offerings using 19b-4 forms and S-1 forms, I’d like to highlight that there is a significant distinction between the two. Unlike 19b-4 forms which have set approval deadlines, S-1 forms do not come with a fixed timeline for SEC approval. Instead, the Securities and Exchange Commission (SEC) will assess the proposed terms at their own pace, mainly relying on the applicants’ responsiveness to the Commission’s comments during the review process. The Chairman of the SEC, Gary Gensler, has previously acknowledged that this process could “take some time,” emphasizing the importance of active collaboration between the issuers and the Commission for a successful registration.
Ethereum Spot ETFs Tipped To Quickly Hit $1 Billion Inflows
As an analyst, I’ve observed that investor and expert optimism towards Ethereum Spot ETFs persists, with expectations high for their future success once they become available for trading. In a recent post on June 28th, Charles Yu, Vice President of Research at Galaxy Research, expressed confidence in these funds, predicting they could attract between 20-50% of the demand experienced by their Bitcoin counterparts.
Based on an estimated $15 billion in total monthly Bitcoin Spot ETF inflows, I, as an analyst, anticipate Ethereum ETFs will see approximately $1 billion in flows during the first five months of trading. Furthermore, due to factors such as lower net inflation and a smaller percentage of Ethereum tokens available on exchanges compared to Bitcoin, I expect Ethereum’s price to exhibit greater sensitivity to these inflows.
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2024-06-30 10:26