The Securities and Exchange Commission (SEC) Chair Gary Gensler has said that the progress of launching the first spot Ether exchange-traded funds (ETFs) is “going smoothly.”
SEC Chair Comments on Progress
During a Bloomberg conference on June 25, Gensler refrained from providing a specific timeline for the ETFs’ launch and avoided commenting on whether they could go live before the November U.S. elections.
Gensler emphasized the importance of asset managers making full disclosure in their registration statements, which are required for the ETFs to become effective.
“What is in front of us — and it’s done at a staff level — is what’s called the registration statements, the disclosure statements”, Gensler explained“. Again, these disclosures are really important. They’re important to investors making investment decisions”.
SEC Yet to Approve Form S-1s
While the SEC approved 19b-4 filings from eight ETF bidders on May 23, the asset managers are still refining their Form S-1s, the final filings that need SEC approval before the ETFs can commence trading.
Some analysts have speculated that the SEC could greenlight the funds for trading as early as the first week of July.
The U.S. crypto industry has actively sought to make digital assets an election issue, particularly due to the increased enforcement actions taken by the SEC under Gensler’s leadership.
Political Implications and Industry Reactions
Presidential candidate Donald Trump pledged to end what he called President Joe Biden’s “war on crypto”, and billionaire investor Mark Cuban argued that Gensler’s actions could “literally cost Joe Biden the election”.
When asked about these comments, Gensler declined to discuss elections and instead affirmed the clarity of the existing rules governing crypto securities and securities laws.
He noted that non-compliance with these laws has consequences, stating, “There’s nothing inconsistent about crypto securities and the securities laws… Unfortunately, there’s a number of people that are non-compliant with the laws.”
Gensler further asserted that up to 20,000 crypto tokens are investment contracts or securities under U.S. law but lack proper disclosure for American investors.
“This is a field that the leading lights from a couple of years ago are either in jail, about to go to jail, or are awaiting extradition… We’re bringing that in front of courts, and those will play out because folks that are not complying with the law hurt the American public.”
Ethereum ETF Providers Update Fee and Investment Details
Several prominent asset managers have submitted revised proposals for Ethereum ETFs to the SEC.
The filings by VanEck, BlackRock, Grayscale, Invesco Galaxy Digital, and Fidelity aim to provide updated information on their respective Ethereum funds, Eric Balchunas, an analyst at Bloomberg, noted.
VanEck’s filing disclosed a management fee of 0.20% for its Ethereum fund, which is in line with competitors like Franklin Templeton, charging 0.19% in management fees.
Meanwhile, Andrew Kang, a founder and partner at Mechanism Capital, has said that the price of Ether could experience a significant drop to as low as $2,400 following the launch of spot ETFs.
According to Kang, Ether attracts less institutional interest compared to Bitcoin, and there are limited incentives for converting spot Ether into ETF form.
