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SEC Discuss Ethereum Spot ETF Approval Potential

SEC Commissioner Hester Peirce emphasized that the approval procedure for an Ethereum ETF will differ from that of Bitcoin. She noted that the SEC has drawn valuable insights from the previous experiences with the spot Bitcoin ETF saga.

Wed, 24 Jan 2024, 09:03 am UTC

In a recent interview with Zack Guzman, SEC Commissioner Hester Peirce discussed the agency's stance on crypto-backed ETFs, highlighting a forthcoming change in their approval process. Unlike the previous Bitcoin ETF saga, where court intervention was sought, Peirce emphasized that the SEC should not require external persuasion for eventual approval of such financial products.

Streamlining Approval for Ethereum ETFs

Peirce disclosed that the SEC aims to streamline the approval process for Ethereum ETF applicants.

According to Crypto News, the regulatory body plans to incorporate regular consumer and market considerations into its evaluation, mirroring the approach taken with traditional ETF products. This shift signifies a departure from the prolonged delays and frustrations experienced with Bitcoin ETF approvals.

Lessons Learned from X Account Hack

The Commissioner delved into the recent SEC X account hack, which disseminated a false approval post, briefly manipulating the market. Peirce expressed her frustration and suggested that the hack might have been averted had the SEC not generated excessive attention around approval decisions. She proposed that employing the standard approach to ETF applications could have prevented such incidents, emphasizing the need to avoid creating unwarranted hype.

According to Coin Gape, Peirce underscored the importance of tempering anticipation in the approval process for Ethereum ETFs. Unlike the spotlight on Bitcoin ETFs, she emphasized that regulatory decisions should not be accompanied by excessive fanfare, reducing the likelihood of similar market manipulations.

The Commissioner clarified that approving spot Bitcoin ETFs does not signal a fundamental shift in the SEC's regulatory approach to the broader crypto industry. Rather than policing cryptocurrencies, the agency intends to focus on regulating securities products linked to crypto that trade on securities exchanges. This approach aligns with existing practices for overseeing other commodity markets, such as gold.

In summary, Commissioner Peirce's insights hint at a more measured and consumer-focused approach to crypto ETF approvals, signaling a departure from past challenges and a commitment to adapt the regulatory framework to the evolving crypto landscape.

Photo: Kanchanara / Unsplash

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