The introduction of spot Ethereum ETFs in the U.S. appears imminent, with potential regulatory approval expected by early July. Ongoing negotiations between asset managers and the U.S. Securities and Exchange Commission (SEC) are close to completion, leaving only minor issues to be addressed before these investment vehicles can be launched.
Possible Approval by Early July
Insiders anticipate that the SEC might approve the final modifications to spot Ethereum ETFs by July 4. Asset managers such as BlackRock, Franklin Templeton, and Grayscale Investments are finalizing their preparations. Following the successful rollout of spot Bitcoin ETFs earlier this year, Grayscale aims to convert an existing Ethereum trust into an ETF.
Executives from two of the involved firms told Reuters that they have made significant progress on the necessary documentation, with just minor issues pending. Another lawyer noted that the approval could be “a week or two away.”
This timeline aligns with the forecast by Bloomberg ETF analyst Eric Balchunas, who suggested earlier this month that approval might occur before the July 4 holiday, possibly by July 2. Although the SEC and its Chair, Gary Gensler, have not provided specific dates, Gensler hinted at a summer approval in a recent Bloomberg interview.
Regulatory Developments
The SEC granted approval for the essential 19b-4 forms last month, and attention has now shifted to finalizing S-1 filings, which are essential for the ETFs to commence trading. The collaboration between the SEC and the issuers is focused on resolving the remaining issues before the anticipated launch.
Projected Market Impact
Bitwise’s Chief Investment Officer, Matt Hougan, estimates that spot Ethereum ETFs could attract over $15 billion in net inflows within the first 18 months. This prediction draws on data from spot Bitcoin ETFs and the relative market size of Ethereum compared to Bitcoin.
Bitcoin’s market cap is currently about $1.26 trillion, while Ethereum’s is around $432 billion. Approximately $56 billion of Bitcoin’s market cap is invested in U.S. spot Bitcoin ETFs, and Hougan expects this figure to reach $100 billion by the end of 2025. The strong demand for spot Bitcoin ETFs suggests a similar interest in Ethereum ETFs.
Conclusion
The potential approval and launch of spot Ethereum ETFs represent a significant advancement in cryptocurrency investment. As the SEC and asset managers complete the final details, the market eagerly anticipates the debut of these funds. If launched successfully, Ethereum ETFs could attract significant inflows and expand investor access to Ethereum.
