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In the latest ETH ETF news, a top Grayscale crypto lawyer has said that a Spot Ethereum ETF is likely to be approved even amid SEC silence over Ethereum (ETH) regulation.
Craig Salm, the Chief Legal Officer at Grayscale, a crypto firm offering various investment products, including those of Ethereum, has downplayed concerns about the lack of communication from the United States Securities and Exchange Commission (SEC) regarding spot Ethereum exchange-traded funds (ETFs).
His comments come amid lingering concerns after the Ethereum Foundation, the non-profit promoting the adoption of the network’s solutions, was subpoenaed by an unnamed state authority.
Beyond this, observers also think the uncertainty around the regulatory status of Ethereum could still impede the approval process.
History Will Repeat Itself for Spot Ethereum ETFs?
In a post on X, Salm acknowledged the ongoing chatter surrounding spot Ethereum ETFs and the agency’s apparent radio silence.
Even with this, the lawyer remains optimistic, drawing parallels to the approval process for spot Bitcoin ETFs. Of note, Salm highlighted constructive engagement between the stringent regulator and spot Bitcoin ETF applicants, including Grayscale, Fidelity, and Ark, in the lead-up to the historic greenlighting of the product in mid-January 2024.
1/ Recently, there’s been a lot of chatter about spot #Ethereum ETFs. I personally am not deterred by it and believe the ETFs should be approved. But right now I want to talk about how I think perceived “lack of SEC engagement” should be viewed at this point:
— Craig Salm (@CraigSalm) March 25, 2024
The lawyer revealed that discussions focused on crucial details like the creation or redemption procedure and custodial arrangements.
By law, the SEC oversees products like spot Bitcoin and Ethereum ETFs. However, at the core, a custodian like Coinbase Custody must be present to store the underlying coins backing every share.
Since spot Bitcoin and Ethereum ETFs share similar underlying functions, Salm believes the groundwork for approval has already been laid, even if the United States SEC has been silent recently.
ETH ETF Optimism Battered By Regulatory Headwinds
Despite this optimistic outlook, the lawyer acknowledged potential roadblocks, notably the recent news of a state authority subpoenaing the Ethereum Foundation, which has been a source of chatter and concern.
The ongoing debate about whether ETH is a security or a commodity remains unresolved. Gary Gensler, the agency chairperson, has not clarified the agency’s position on the coin. The United States SEC, before approving the spot Bitcoin ETF, said BTC is a commodity. This has not been the case for ETH.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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