Top Ethereum Spot ETF Applicants and the Road Ahead

Following the U.S. Securities and Exchange Commission's (SEC) groundbreaking approval of 11 spot Bitcoin exchange-traded funds (ETFs) on January 10, the spotlight now shifts to the possibility of spot Ethereum ETFs gaining approval in 2024. 

According to Bloomberg ETF analyst Eric Balchunas, there's a 70% chance that spot Ether ETFs will receive approval by May, a crucial month for the SEC to finalize decisions on several applications.

Balchunas, in his analysis, draws parallels between the approval of spot Bitcoin ETFs and the potential green light for spot Ether ETFs. He emphasizes the close relationship between Ether and Bitcoin, stating that "Ether spot is tied to the hip of Bitcoin spot."

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Leading Ethereum ETF Applicants

• VanEck: The first to file for a spot in Ethereum ETF in September 2023.
• BlackRock: As a major financial institution BlackRock filed for entering the Ethereum ETF in November 2023.
• ARK Invest: Another major player in the financial industry vying for approval after filing for the ETF last September.

Additional Ethereum ETF Applicants

Apart from the prominent names, other companies seeking approval for spot Ethereum ETFs include:

• Fidelity (filed November 2023)
• Invesco Galaxy (filed October 2023)
• Grayscale (filed October 2023)
• Hashdex (filed September 2023)

The deadlines for the approval of spot Ethereum ETFs are as follows:

Franklin Templeton Joins the Race

The latest contender in the Ethereum ETF race is Franklin Templeton, as confirmed in a filing on February 12 with an approval deadline in November 2024.. The asset manager has identified Coinbase Custody as its cryptocurrency custodian and Bank of New York Mellon as its cash custodian, administrator, and transfer agent.

Franklin Templeton's proposal allows only cash creations and redemptions, a departure from in-kind creations and redemptions that would involve direct transactions in crypto.

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SEC's Historical Delays

The SEC, known for multiple delays in approving spot Bitcoin ETFs, faces a similar situation with spot Ethereum ETFs. Now nine Ethereum ETF applicants, each with different deadlines, await the SEC's decision. 

There's speculation that the SEC might decide on all applications simultaneously, as observed in the case of spot Bitcoin ETFs.

What do experts predict for the Ethereum spot ETF's approval?

Predictions and Uncertainties

• Polymarket Prediction: 48% chance of approval for a spot Ethereum ETF in May.
• James Seyffart: Anticipates 60% odds of approval in May.
• JP Morgan Analyst Nikolaos Panigirtzoglou: Expects 50% odds of approval in May.
• Standard Chartered: Believes approval is likely in May.
• TD Cowen: Expects approval in 2025 or 2026.

Despite these predictions, uncertainties linger, primarily due to SEC Chair Gary Gensler's steadfast position that all cryptocurrencies, except Bitcoin, are financial securities. Experts, however, have hinted that certain tokens, including Ethereum, could shed the securities classification if they became decentralized.