In a recent statement to CNBC, Gary Gensler, the chair of the U.S. Securities and Exchange Commission (SEC), hinted at the possibility of Ethereum’s ether (ETH) being included in exchange-traded funds (ETFs) following years of trading as futures on the Chicago Mercantile Exchange.
Gensler’s remarks came amidst anticipation within the crypto industry regarding the SEC’s stance on ETH ETFs. Despite earlier expectations of rejection, Gensler’s comments suggest a potential shift in regulatory attitude towards such products.
“Ethereum had been traded on the Chicago Mercantile Exchange futures for three-plus years. And the staff looked at that closely, and that was approved,” Gensler stated during his televised interview. “Now, the underlying exchange traded products (ETPs) still need to go through a process to have the disclosure about that. That will take some time, but they’re working on that right now.”
The SEC chair’s tone during the interviews, both on CNBC and at an International Swaps and Derivatives Association/Securities Industry and Financial Markets Association event, indicated a measured approach to the approval process, downplaying the significance of the decision in light of the agency’s previous actions regarding bitcoin spot ETFs.
Gensler emphasized the agency’s commitment to operating within legal boundaries and in accordance with court interpretations, suggesting that the recent D.C. Circuit Court of Appeals ruling in favor of Grayscale against the SEC may have influenced the regulator’s stance on ETF approvals.
However, despite Gensler’s apparent openness to ETH ETFs, uncertainties remain regarding the timeline for final approval. While some industry insiders anticipate the emergence of these funds within the coming months, a precise timeline has yet to be determined.
In addition to addressing ETFs, Gensler reiterated his concerns about the lack of required public disclosures within the crypto industry. He emphasized the importance of transparency and adherence to legal standards, particularly regarding tokens’ compliance with securities regulations.
Gensler’s remarks underscore the SEC’s ongoing efforts to navigate the evolving landscape of digital assets while ensuring investor protection and regulatory compliance. As the crypto industry continues to evolve, the SEC’s approach to ETFs and disclosures will play a pivotal role in shaping its future trajectory.
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