Ethereum
Bloomberg analyst extends launch deadline
Bloomberg analyst Eric Balchunas has pushed back the planned launch date for Ethereum Spot ETFs in the United States. The move follows comments from the U.S. Securities and Exchange Commission on the second round of S-1 filings.
S-1 Forms Receive Late Response From SEC – Details
In May, the SEC abruptly approved 19b-4 filings from eight potential issuers of the Ethereum spot ETF, authorizing the first step for the possible introduction of these investment funds. Under U.S. regulations, the Commission would also have to greenlight the S-1 forms of these proposed ETFs before trading can begin. For context, Forms S-1 contain information about investment objectives, strategies, risks, fees, and more. of an ETF.
After the initial submission of all draft S-1 forms on May 31, the SEC responded quickly with comments described as “fairly mild” and all issuers were ordered to submit the requested amendments within one week.
Given the speed of the operation, Eric Balchunas postulated that the Commission should quickly approve these forms by selecting July 2nd as a potential launch date for the spot Ether ETF. However, the SEC responded late to its second round of comments, although the requests were also described as “light adjustments.”
Following this development and the approach of the Thanksgiving holiday in the United States which will not allow little work to be done next week, Balchunas predicted Work on S-1 forms will resume on July 8, with approval coming shortly thereafter.
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Unfortunately, we’re going to have to push our over/under back until after the holidays. It seems like the SEC took longer to respond to people this week (although there were still very minor changes) and from what I hear, next week is dead because the holidays = July 8th, the process starts again and shortly after that they’ll launch… https://t.co/0ZQR7yiBLt
— Eric Balchunas (@EricBalchunas) June 28, 2024
It should be noted that, unlike Forms 19b-4, Forms S-1 do not have a fixed deadline, with approval depending solely on the SEC’s satisfaction with the terms proposed by issuers. Earlier in June, SEC Chairman Gary Gensler had declared This process could “take some time,” saying approval will depend largely on how responsive applicants are to the Commission’s comments.
Ethereum Spot ETFs Expected to Rapidly Reach $1 Billion in Inflows
Separately, investors and analysts have remained optimistic about the potential performance of Ethereum Spot ETFs when they eventually begin trading. In a X post On June 28, Charles Yu, vice president of research at Galaxy Research, argued that these funds would receive at least 20-50% of the demand seen in Bitcoin counterparts.
With total Bitcoin Spot ETF inflows estimated at $15 billion, Yu predicts that Ethereum ETFs will see $1 billion in monthly inflows in the first 5 months of trading. Additionally, Charles Yu expects Ethereum to exhibit higher price sensitivity to these flows for a variety of reasons, including lower net inflation and a lower supply percentage on exchanges.
Featured image from Space.com, chart from Tradingview