Ethereum ETF Approval Process Set to Differ from Bitcoin ETF

• Altered Approval Approach: SEC Commissioner Peirce indicates that Ethereum ETF approvals will undergo changes, deviating from the Bitcoin ETF approval process.
• Anticipation Management: The SEC aims to avoid building unnecessary hype around regulatory decisions, learning from past incidents like the X account hack.

SEC Commissioner Hester Peirce has provided insights into the approval process for Ethereum ETFs, indicating that it won’t follow the same path as Bitcoin ETFs. According to Peirce, the SEC has learned valuable lessons from the challenges faced during the Bitcoin ETF approval saga.

Lessons Learned: Ethereum ETFs to Face Altered Approval Process

In an interview, Commissioner Peirce stressed that the approval process for Ethereum ETFs will undergo changes, incorporating lessons from past experiences. Unlike the delays witnessed in Bitcoin ETF approvals, the SEC aims to consider regular consumer and market factors when evaluating applications for Ethereum-based ETFs.

Peirce emphasized, “We shouldn’t need a court to tell us that our approach is arbitrary and capricious in order for us to get it right.”

NEW: SEC Commissioner Hester Peirce tells me the SEC won't repeat the same mistakes with ETH ETFs after fumbling Bitcoin ETFs:

"That's not how we're going to do our approvals … I think that kind of a lesson will certainly stick with us.pic.twitter.com/QNu52Gmr3H

— Zack Guzmán (@zGuz) January 23, 2024

Frustrations Over Bitcoin ETF Delays and X Account Hack

Expressing frustration over prolonged delays in Bitcoin ETF approvals, Peirce highlighted that she believed these products met approval requirements long ago. The Commissioner also addressed the recent X account hack, acknowledging that the SEC’s heightened attention to these approvals may have contributed to the incident. Peirce suggested that the SEC could have avoided such situations by adhering to its standard approach to ETF applications.

Anticipation Management: Key Element in Ethereum ETF Approvals

Peirce underlined the importance of avoiding heightened anticipation in the approval process for Ethereum ETFs. Learning from past experiences, the SEC aims to manage expectations effectively, ensuring a more stable market environment during the approval decision period. The Commissioner stressed that building unnecessary hype around regulatory decisions is not in the SEC’s best interest.

SEC’s Focus: Regulating Crypto-Backed Securities

While Peirce clarified that approving spot Bitcoin ETFs doesn’t signal a shift in how the SEC regulates crypto, she emphasized the agency’s commitment to regulating securities products based on crypto. The SEC’s focus remains on overseeing crypto-related products traded on securities exchanges, aligning with its regulatory approach in markets like gold.