US SEC Opens Discussions On Ethereum ETF S-1 Registrations With Issuers

The US Securities and Exchange Commission (SEC) has opened discussions with the prospective spot Ethereum ETF issuers on the recently submitted S-1 registration documents.

This move has increased market optimism, triggering a price surge for Ether. Moreover, any crypto market observers anticipate more institutional adoption and price rallies upon the spot Ethereum ETF approval.

The SEC Commences Initial Discussions

In an X post on May 23, prominent Fox Business journalist Eleanor Terrett disclosed that the SEC had begun discussions on Ethereum ETFs.

While citing anonymous sources, the journalist noted that the talks revolve around potential issuers’ S-1 registration forms. The sources further reported that there’s still “work to do” on the submitted forms.

According to another undisclosed source, the Division of Investment Management seemed unprepared for the change. While such early discussions are not expected to disrupt the progress of getting an Ethereum ETF, the source remained cautiously optimistic.

Moreover, the SEC needs to approve the 19b-4 forms to get approval for the spot Ethereum ETFs. Notably, the regulator followed the same comprehensive order in its approval process for Bitcoin ETFs.

With the agency’s approval for the forms, the S-1 registration documents must become effective. This will enable the launch of the ETH ETF trading. Also, the forms pass through a series of amendment stages before getting the final approval. 

Meanwhile, Fidelity recently filed an amended S-1 form. With ongoing discussions regarding S-1 forms, more potential amendments could follow.

Additionally, Matthew Sigel, the Head of digital assets research at VanEck, reacted to the thread of events for the ETFS. He expressed displeasure that the SEC usually makes multiple approvals on the same day, allowing trading at the same time.

Moreover, Sigel expected the regulator to maintain a one-on-one pattern, following the sequence of their submitted dates.

The Crypto Market Remains Optimistic About ETH ETFs

The SEC has hit a deadline for its decision regarding VanEck’s spot Ethereum ETF 19b-4 form. Its initiation of discussions with potential issuers could be a positive step. 

Several market observers and participants are optimistic about getting spot ETH ETFs. The speculation has positively impacted Ether’s price amid the bearish trend in the broader market.

Eric Balchunas, a senior ETF analyst at Bloomberg, commented on the process. He anticipates an announcement from the SEC around 4 PM ET on May 23. 

Balchunas’ forecast was similar to the SEC’s pattern for the Bitcoin ETF announcement at around 3:45 PM ET.

Also, Daniel Yan, Matrixport co-founder, gave three scenarios and possible implications regarding the approval of ETH ETFs. Firstly, he expects a sell-on-fact response if the SEC approves only the 19-b4 forms. 

The second instance could trigger a “very bullish” market sentiment once the regulator approves both 19-b4 and S-1 forms. Lastly, rejecting the 19-b4 forms could cause a “very bearish” impact.

As of 08:07 AM EST on May 23, Ethereum trades at $3,916, indicating a 5.60% rally within the past 24 hours. Also, its market cap currently sits at $470.76 billion.