SEC Urges Major Exchanges to Update Their Spot Ethereum ETF Applications

• The U.S. Securities and Exchange Commission (SEC) asked Nasdaq, CBOE, and NYSE to fine-tune their applications to list spot ether exchange-traded funds (ETFs), signaling potential approval
• This move by the SEC was a surprise, as the cryptocurrency industry had been expecting rejection of the ether ETF applications
• The price of ether jumped as much as 18% on Monday and was up another 8.6% on Tuesday morning following this development

The US Securities and Exchange Commission (SEC) has requested exchanges to modify their applications for listing spot ether exchange-traded funds (ETFs). This move signals the agency may be preparing to approve the filings, marking a major win for the crypto industry.

SEC Engagement With Exchanges

On Monday, the SEC asked Nasdaq, CBOE, and NYSE to quickly update their filings, a typical request before approval. The exchanges have applied for rule changes needed to list new ETFs, the first step before SEC approval of registration statements.

Impact on Ether Price

The SEC’s apparent openness to ether ETFs has boosted prices. Ether jumped 18% on Monday and was up another 8.6% Tuesday morning to $3,802.

Background on ETF Applications

Issuers like VanEck and ARK Invest filed for spot ether ETFs after the SEC approved futures-based products in October. The SEC had long rejected spot bitcoin ETFs over manipulation worries until forced to approve them last year.

Potential Significance

If approved, spot ether ETFs could see rapid inflows like bitcoin funds did. Within a week, two new bitcoin funds attracted over $1 billion in assets. More crypto ETF options would expand investor access.

Next Steps

While exchange rule changes are pending, the SEC still needs to approve each issuer’s registration statement. That process has no set timeframe. So ether ETFs may not begin trading for several more months despite this positive sign.

Conclusion

The SEC’s proactive engagement has surprised many expecting rejection of spot ether ETFs. Approval would validate cryptocurrencies in the eyes of mainstream investors and enable wider participation in ether price gains. But the long road to actual product launch continues.