การวิเคราะห์เชิงลึก: ปัจจัยสำคัญที่ขาดหายไปจากการอนุมัติ Ethereum Spot ETF คืออะไร?

ต้นฉบับ | Odaily Planet Daily

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ETH, which had been dormant throughout the bull market, suddenly regained its vitality in the early hours of Tuesday. The price rose from 3110 USDT to 3841 USDT, with the highest increase of more than 20% in a day, and directly led to the rise of the market. Among them, the increase of altcoins related to the ETH ecosystem exceeded 10%. Such a gratifying rise is mainly due to the fact that the US Ethereum spot ETF has changed from being optimistic about approval to being expected to be approved.

However, it remains unknown whether the US Ethereum spot ETF will eventually be approved. Although Bloomberg ETF analysts and related institutions continue to express positive views, after experiencing the selling news incident of the Bitcoin spot ETF, many crypto investors still have doubts about this.

To this end, Odaily Planet Daily has sorted out the relevant questions currently in the market and tried to find the corresponding answers.

The conversion process of reputation of whether Ethereum spot ETF can be approved

First, let’s briefly review the process of the Ethereum spot ETF being approved:

The reason is that Nate Geraci, president of ETFStore, posted a tweet on X, raising a potential possibility – due to the process deadline, the U.S. Securities and Exchange Commission (SEC) must decide this week whether to approve the spot Ethereum ETF.

However, the full listing process requires the filing of two forms: an exchange rule change ( 19b-4s) and the approval of a registration statement (S-1s) , both of which are required for an ETF to launch. Geraci noted that if the SEC wanted to drag out the process, it could theoretically approve the 19b-4s and then take a slow approach to the S-1s , especially given that the SEC has been silent on the matter, a stark contrast to its previous activity in bitcoin ETFs.

Later, Bloomberg analyst Eric Balchunas reposted the post and proposed that the probability of spot Ethereum ETF approval has been raised from 25% to 75%. He said, I heard some rumors this afternoon that the SEC may make a 180-degree turn on this issue (based on some political reasons), so now everyone is preparing. He also reiterated that the probability will be capped at 75% until more evidence is seen, such as application updates.

Later, his colleague James Seyffart added: “Eric Balchunas raised the odds of spot Ethereum ETF approval to 75%. But that’s for the May 23 deadline for the 19b-4 (VanEck’s deadline). We also need S-1 approval. It could be weeks to months before we see S-1 approval and an actual Ethereum ETF go live.”

Later, Fox reporter Eleanor Terrett said that a source claimed that the current development of the spot Ethereum ETF is that things are evolving in real time. In the current context, it means that the general belief that it would not be approved may change.

At the same time, according to CoinDesk, the SEC asked exchanges to speed up the update of the 19B-4 documents regarding the spot Ethereum ETF. The above process description comes from Overnight Bull Return: ETH Soared 20%, Will the SEC Surprise and Approve the Ethereum Spot ETF? For details, please read this article.

From the above content, the author found that there are some doubts that need to be confirmed.

1. Why is the SECs attitude towards the Ethereum spot ETF approval and the previous Bitcoin spot ETF approval so polarized?

2. Is May 23 still a key node for Ethereum spot ETF?

3. Previously, the main reason why Ethereum spot ETF was not favored for approval was whether Ethereum was defined as a security, but with the current development trend, it seems that the SEC has found a solution to this problem. How is it reflected specifically?

4. Bloomberg analyst Eric Balchunas believes that the SECs change of attitude is due to some political reasons. What are the specific political reasons?

5. If the Ethereum spot ETF is approved, when will it be approved?

Based on the answers to the above 5 questions, we can uncover the reasons for the change in the reputation of the Ethereum spot ETF and predict whether and when it will be approved.

5 Questions About Ethereum Spot ETF

Before starting the QA, it is necessary to introduce the two key documents that determine whether the Ethereum spot ETF can be approved: Form S-1 and Form 19 B-4.

Form S-1

Form S-1 is a registration statement that ETF issuers must submit to the SEC. S-1 is just one form of registration statement, and its main function is to ensure that ETFs are registered in accordance with the Securities Act, especially for newly issued ETFs.

A registration statement on Form S-1 typically includes the funds investment objectives, strategies, and risks; information about the funds administrator; backgrounds of the portfolio managers; details of fees and expenses; and the composition of the investment portfolio.

Total Form S-1 review time: The entire process typically takes 60 to 120 days.

19 Form B-4

If an ETF plans to be listed on an exchange, the issuer needs to submit Form 19b-4 to the SEC through the exchange. This form is submitted by the exchange and contains the proposed changes and instructions for the listing rules in order to obtain SEC approval so that the ETF can be listed and traded on the exchange.

Form 19B-4 contains the complete text of the rule; the purpose and rationale for the change; an assessment of the impact on the market and investors; and an opportunity for public comment.

The SEC can extend Form 19B-4 three times, with the total duration ranging from 90 days to six months.

Combining the introduction of the two documents, the two submit different entities. The S-1 registration statement is submitted by the ETF issuer to the SEC, while the 19B-4 form is submitted by the exchange. From this, it can be seen that the 19B-4 is more like an admission document that allows the ETF to be listed on the exchange, while the S-1 registration statement is an introduction to the ETF.

Compared with the approval of the Ethereum spot ETF and the Bitcoin spot ETF, why is the SECs attitude towards the approval of the Ethereum spot ETF so polarized?

First, in terms of the difficulty of approval, Bitcoin spot ETF is the first cryptocurrency spot ETF, and the SEC is not clear about the relevant process and approval issues. Therefore, it can be seen that before the Bitcoin spot ETF was approved, the SEC held several relevant meetings to ensure the process of such ETFs. As for the Ethereum spot ETF, the SEC has more experience in the approval of relevant documents, so it seems not to be active in negotiating with the issuer.

Secondly, there is a historical issue in Bitcoin spot ETF and Ethereum spot ETF, which is whether PoS tokens are defined as securities. This factor is also the main reason hindering the approval of Ethereum spot ETF.

Finally, the most notable feature of Ethereum compared to Bitcoin is that the Ethereum Foundation still has a great influence on Ethereum, which is prone to regulatory risks such as market manipulation.

Is May 23 still a key node for Ethereum spot ETF?

According to the final approval time of the 19 B-4 form of the Ethereum spot ETF in the figure below, VanEck is the first issuer to submit the 19 B-4 form to the SEC. After three extensions, May 23 is its final resolution node.

Judging from the previous approval nodes of Bitcoin spot ETFs, January 10 was the final approval date for BlackRocks 19B-4 document, and the SEC approved the remaining 10 Bitcoin spot ETFs on January 10. Therefore, if we take Bitcoin spot ETF as an example, May 23 is indeed the key node for the approval of Ethereum spot ETF.

When the SEC approves relevant ETFs, it will not select individual ETFs for approval, and will most likely approve them all at the same time. This point has been introduced in the previous article about Bitcoin spot ETFs.

However, it is worth noting that May 23 is the final approval date for Form 19 B-4. As mentioned above, there is also an S-1 registration statement that needs to be approved. Therefore, relevant institutions in the market believe that the SEC may approve Form 19B-4 first and then delay the approval time in the S-1 registration statement.

So what does the approval of Form 19B-4 mean? According to relevant information, 19B-4 only means that the issuers ETF can be listed on the relevant exchange, but it cannot officially start trading because the core S-1 registration statement must be passed for the ETF to be officially launched. Both are crucial for the ETF to be launched.

Previously, the main reason why Ethereum spot ETF was not favored for approval was whether Ethereum was defined as a security, but with the current development trend, it seems that the SEC has found a solution to this problem. How is it manifested specifically?

Whether Ethereum is defined as a security has been explained in detail in many previous articles. The bottom line is that Ethereum is shifting from PoW to PoS, that is, users use tokens to stake, maintain the network and earn income, which violates the Securities Law.

But can the expected approval of Form 19B- 4 prove that the SEC does not consider Ethereum to be a security? In fact, it cannot. As mentioned above, Form 19B -4 is the content submitted by the exchange to the SEC regarding the listing of the ETF on the exchange. It has nothing to do with the actual operation of the Ethereum spot ETF. The document that really matters is the S-1 registration statement.

However, according to the SA documents submitted by the relevant ETF issuers, the previous S-1 documents clearly mentioned that the ETF has relevant discussions such as ETH staking. In other words, the previous Ethereum spot ETF also counted the income from Ethereum staking as ETF-related income.

However, since February this year, VanEck submitted an amended S -1A document to the SEC, which was the first amendment to the S-1 registration statement submitted by many issuers that did not include a pledge clause. And there has been no news about VanEck submitting S-1 documents again since then.

In recent days, Fidelity and Grayscale have successively removed the pledge section from their S-1 registration statements and resubmitted the documents to the SEC.

It is not difficult to find from the above related events that the SEC may have found a way to distinguish whether Ethereum is a security: if ETH in the ETF is not pledged, then Ethereum is not a security; conversely, Ethereum used for pledge will be defined as a security.

This is also the reason why most issuers resubmit S-1 documents without pledges, and it is also a necessary condition for the SEC to accept Ethereum spot ETFs.

Bloomberg analyst Eric Balchunas pointed out that the SECs change of attitude was due to some political reasons. What does it mean specifically?

The SECs change of attitude is based on some political factors. This statement is not groundless. According to relevant news reports, one of the points is that the SAB 121 rule that has plagued the crypto industry may be overturned.

The core content of SAB 121 is that it requires companies that hold cryptocurrencies to record the cryptocurrencies held by customers as liabilities on their balance sheets. However, the cryptocurrency industry generally believes that this regulation is too strict and actually hinders custodians or companies from holding crypto assets on behalf of their customers, which is not conducive to the further development of the industry. Therefore, it has long been trying to overturn SAB 121 through lobbying and other means.

In other words, assuming that SAB 121 is overturned, the shackles restricting the development of the crypto industry in the United States will be broken. The key node at present is the final resolution of US President Biden on this clause on May 28.

Another political factor is whether FIT 21 (also known as HR 4763) can be approved, a new bill aimed at clarifying the regulatory framework for cryptocurrencies. The current progress is that all members of the House of Representatives plan to vote on FIT 21 this week (it is expected to start voting late Wednesday or early Thursday local time, and it may be launched at the same time as the ETH ETF).

The two bills will change the overall development of cryptocurrency in the United States, which may determine the progress of the SECs approval of the Ethereum spot ETF.

Most of the above analysis comes from the article Has the policy direction changed? In addition to ETFs, these two major events reveal a new attitude towards crypto regulation . Readers are requested to read the details themselves.

If the Ethereum spot ETF is approved, when will it be approved?

If the SEC follows the previous approval process for the Bitcoin spot ETF, May 23 will be the fastest time point for approving the Ethereum spot ETF. At the same time, judging from the fact that issuers are continuously submitting revised 19B-4 และ S-1A documents, the possibility of approval on May 23 is higher.

However, it cannot be ruled out that, as Bloomberg analysts said, the SEC is very likely to approve Form 19B -4 first and then postpone approval of the S-1 registration statement due to political factors. The approval time may be 1-3 months after the relevant political bills (SAB 121 and FIT 21) have clear results.

A less likely prediction is that the SEC will postpone its decision on the Ethereum spot ETF until after the US election in November, when it will make a decision based on the new leaderships attitude towards cryptocurrencies.

However, the author believes that starting from the Ethereum spot ETF itself, the core issue of whether Ethereum is a security, the SEC and the issuer have found a balance point, so it is likely to be approved on May 23.

Odaily Planet Daily would like to remind everyone that there are still great uncertainties in the approval of Ethereum spot ETF, and the market fluctuations will be more obvious. If the Ethereum spot ETF is approved, it is still unknown whether Grayscale will dump the market like the previous Bitcoin spot ETF. Be sure to invest cautiously and pay attention to risks.

This article is sourced from the internet: In-depth analysis: What are the key factors missing from the approval of Ethereum spot ETF?

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