SEC To Reject Ethereum ETF Says Van Eck CEO, What Now?

The post SEC To Reject Ethereum ETF Says Van Eck CEO, What Now? appeared first on Coinpedia Fintech News

Ethereum exchange-traded funds will be rejected by the U.S. Securities and Exchange Commission (SEC) by May, according to Jan van Eck, the CEO of investment firm VanEck. With the SEC maintaining radio silence on pending applications, van Eck’s insights shed light on the regulatory hurdles facing the cryptocurrency industry.

Ethereum ETF Reject?

In an interview with CNBC on April 9, Jan van Eck delivered sobering news for proponents of Ethereum ETFs, stating that his firm’s spot Ether ETF application will “probably be rejected.” This negative outlook comes amidst a prolonged period of regulatory inaction from the United States Securities and Exchange Commission (SEC) regarding pending Ethereum ETF applications.

VanEck, along with Cathie Wood’s ARK Invest, was among the first to file for spot Ether ETFs in the U.S., with final decisions scheduled for May 23 and May 24 respectively. 

However, the lack of feedback from the SEC has raised concerns within the industry, prompting van Eck to express skepticism about the likelihood of approval.

The prevailing “radio silence” from the SEC has fueled doubts among commentators, with Senior Bloomberg ETF analyst Eric Balchunas lowering the odds of approval from 70% to 35%. Moreover, Fellow ETF analyst James Seyffart also expressed concern, stating that the lack of comments or interactions from the SEC is a negative indicator.

Concern Over PoS

Meanwhile, the SEC’s acceptance of Bitcoin’s proof of work (PoW) protocol contrasts with concerns over Ethereum’s proof of stake (PoS). Unlike Bitcoin miners, Ethereum’s PoS participants stake tokens, raising regulatory hurdles for Ethereum ETF approval. 

CoinShare’s CEO Jean-Marie Mognetti expressed skepticism about ETF approval, stating, “I don’t see anything getting approved this side of the year.” This difference has raised eyebrows at the SEC, adding another layer of complexity to approving Ethereum ETFs

Success of Bitcoin ETFs

Despite the uncertainty surrounding Ethereum ETFs, VanEck’s spot Bitcoin ETF, trading under the ticker HODL, has witnessed significant success since its launch in mid-January. With an inflow of $461.7 million, it ranks among the top newly launched funds, highlighting the growing interest in Bitcoin among investors.

Jan van Eck commented on the success of Bitcoin ETFs, describing Bitcoin as a “maturing asset” and noting that many investors are still looking to gain exposure to the asset.

As regulatory uncertainty looms over the approval of Ethereum ETFs, industry experts are closely monitoring developments from the SEC.