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Craig Salm’s Insights on Ethereum ETF Approval
Craig Salm, the Chief Legal Officer at Grayscale, recently provided valuable insight into the potential approval of Ethereum exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC). Salm expressed his belief that the SEC’s perceived lack of engagement with Ethereum ETF applicants would not be a significant barrier to the approval of such products.
Factors Influencing Approval
In a post on X (formerly Twitter) on March 25, Salm highlighted that the SEC had already engaged with issuers during the application process for spot Bitcoin ETFs. He emphasized that key issues related to creation and redemption processes, transaction methods, and custody concerns had been addressed during the approval of Bitcoin ETFs, and these solutions could easily apply to Ethereum.
Salm stated, “All of these issues were figured out and are identical when comparing spot Bitcoin to Ethereum ETFs. The only difference is rather than the ETF holding bitcoin, it holds ether. So in many ways, the SEC already has engaged, and issuers simply have less to engage on this time.”
Furthermore, Salm echoed arguments previously made by Paul Grewal, Coinbase’s chief legal officer, regarding the necessity for the SEC to approve a spot Ethereum ETF. He emphasized the strong correlation between ETH futures and spot prices, supporting the case for approval.
Salm added, “Investors want and deserve access to Ethereum in the form of a spot Ethereum ETF, and Grayscale believes the case is just as strong as it was for spot Bitcoin ETFs.”
Concerns and Challenges
Despite the optimism expressed by Salm and others, recent developments have cast doubt on the approval of Ethereum ETFs. The SEC’s delays in the approval process for various issuers have raised concerns among market analysts, dampening expectations for a swift approval.
Moreover, reports indicate that the SEC is evaluating Ethereum’s regulatory classification, further complicating the approval prospects. The uncertainty surrounding Ethereum’s status as a security or commodity adds another layer of complexity to the regulatory landscape.
In conclusion, while there is optimism for the approval of Ethereum ETFs based on past engagement with Bitcoin ETFs, regulatory challenges and uncertainties continue to pose obstacles to the realization of this goal.
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