Gary Gensler: The time for Ethereum spot ETF to start trading depends on how quickly the issuer responds to inquiries

U.S. Securities and Exchange Commission Chairman Gary Gensler said on Wednesday that when spot ETFs tied to the cryptocurrency Ethereum begin trading depends largely on how quickly issuers respond to SEC inquiries. The SEC approved applications from Nasdaq, CBOE and NYSE last month to list spot Ethereum ETFs. It was an unexpected victory for the cryptocurrency industry, which had expected the SEC to reject the applications after meetings with regulators. Before ETFs begin trading, the SEC must still approve the ETF issuer's registration statement, which details disclosures to investors. The process typically involves a lot of correspondence between ETF issuers and SEC officials. "These registrants will proactively respond to the comments they receive, but the extent of their response is really up to them," he said. Gensler declined to say whether he thought the process would take weeks or months. Gensler and SEC officials have not previously commented on why the SEC made a U-turn and approved the application for a spot Ethereum ETF, but he said on Wednesday that the lawsuit filed by Grayscale last year forced the SEC to approve a spot Bitcoin ETF in January, which influenced the SEC's view on Ethereum. Grayscale successfully argued at the time that the SEC had previously approved an ETF tied to Bitcoin futures, so it should also approve a spot Bitcoin ETF because Bitcoin futures prices are highly correlated with spot prices. Gensler said the cases are similar because the futures Ethereum ETF has been trading since last year. SEC staff "looked at the filings and looked at various correlations... which are relatively similar to the correlations in the Bitcoin space." The SEC approved the spot Bitcoin ETF in January this year after the court ruled in Grayscale's favor last year. Gensler acknowledged the court's decision in a statement at the time, adding that he believed approving the products was the "most sustainable path forward." The SEC has been rejecting Bitcoin ETFs for a decade. Gensler said, "But the court ruled the opposite. We adjusted." However, he added that he still believes that the cryptocurrency field is "rife with fraud, scams and conflicts." (Jinshi)