As the deadline ends today for Ethereum ETF issuers to resubmit their S-1 forms, the U.S. Securities and Exchange Commission (SEC) is nearing a pivotal decision that could potentially classify Ethereum as a commodity.
Last month, the SEC returned the initial S-1 filings to the issuers with minor comments, a move that suggests a positive outlook towards the approval process. SEC asked ETF issuers to address the concerns and refile by July 8.
These forms are part of a two-tiered application process, following the earlier approval of the 19b-4 forms. While there is no fixed timeline for the S-1 approvals, issuers are gearing up for a quick turnaround, anticipating a final nod from the SEC.
The SEC are imminently set to approve ETH as a commodity. We sat down with Konstantin Shulga, CEO and Co-founder of Finery Markets, who has offered his analysis.
Has the approval of ETH been rushed a little? Many institutional stakeholders are reportedly scrambling to put the right infrastructure in place ready for July 8th?
“It typically takes 6-9 months for innovative financial products to be integrated into the product portfolios of financial firms for widespread adoption. This process involves significant time and resources, including training sessions, updates to IT and operational systems, and adjustments to sales processes.”
“The adoption process follows a pattern of pioneers, followers, and mass users, with the key factor being the legitimization of ETH as a mainstream asset rather than the timing of adoption.”
“Moving forward, competition will drive the development of infrastructure to meet the growing demand, as evidenced by the record-breaking inflows into the BTC ETF following its approval.”
Can ETH be classed as a security? Much debate has surrounded this topic in recent months, with a difference in opinion across the board?
“The surge of cryptocurrency as a unique and highly desired asset class poses a significant conundrum for financial regulators, who are struggling to determine how to categorize these digital assets within established classifications like commodities, currencies, and securities.”
“Differing viewpoints among regulators regarding the classification of assets such as ETH have resulted in ongoing difficulties in oversight and regulation. Despite ongoing debates, the main point is that over the past ten years, this up-and-coming asset class has consistently drawn interest from both retail and institutional investors.”
“Therefore, we observe the conventional trend of regulations trailing behind innovations, and this crypto adoption process is unidirectional. It is simply a matter of time.”
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