- Fidelity and Blackrock are leading the Bitcoin spot ETF market with $5 billion in assets.
- The industry is now anticipating the approval of Ether spot ETFs, with varying opinions on when it might happen.
Bitcoin spot ETFs have garnered significant attention and investments, with Fidelity and Blackrock emerging as industry leaders by attracting a combined total of $5 billion in assets. However, the crypto market is now eagerly awaiting the arrival of Ether spot ETFs, raising questions about when regulatory approval will come. Experts remain divided on the timeline, with some suggesting May as a potential approval date, while others believe it may be several years away.
SEC’s Postponement Fuels Speculation
In January, the SEC postponed the deadline for a group of Ethereum ETF applications, including those from Grayscale and BlackRock. This move has only fueled market speculation, with both crypto enthusiasts and Wall Street experts attempting to predict when SEC Chair Gary Gensler might give the green light.
TD Cowen, the financial services arm of Canadian financial group TD Securities, recently published a note expressing skepticism about the timing of an Ethereum ETF approval. According to the analysts at TD Cowen, it could take more than three years for an Ethereum ETF to reach the market. They believe that Gensler is unlikely to approve two crypto spot ETFs within the same year and may prefer to gain insights from the recently approved Bitcoin ETFs before progressing to Ethereum.
Political Considerations and Polarization
In the United States, the approval of an ETF involves various factors beyond financial and economic considerations, including politics. TD Cowen highlights that the nation is currently experiencing heightened polarization, with decisions often influenced by party lines. This polarization extends to cryptocurrency-related matters, as seen with the differing opinions on central bank digital currencies (CBDCs).
The note from TD Cowen suggests that there may be little incentive for SEC Chair Gary Gensler to approve a spot Ethereum ETF, especially considering the potential backlash from progressive Democrats who were unhappy with the recent approval of a Bitcoin ETF.
Despite TD Cowen’s cautious outlook, some experts believe that an Ethereum ETF could receive approval this year. UK banking giant Standard Chartered, for instance, has pointed to May 23rd as a potential approval date.
