The United States Securities and Exchange Commission (SEC) recently granted approval for Spot Bitcoin ETFs, marking a significant milestone for the cryptocurrency market. However, TD Cowen, a prominent American investment bank and financial service firm, has expressed concerns about potential delays in the approval process of Ethereum Spot ETFs. This article will delve into TD Cowen’s forecast and the factors contributing to the prolonged decision-making process.
TD Cowen, a division of TD Securities, has made a bold prediction, stating that the US SEC is unlikely to approve Ethereum Spot ETFs before the specified deadline. While the SEC is obligated to make its final decision by August 7, 2024, TD Cowen foresees delays that could extend beyond this timeline. The bank believes that the regulatory agency will prioritize accumulating sufficient knowledge and experience from its previously approved Bitcoin Spot ETFs before venturing into the approval of Ethereum Spot ETFs.
SEC’s Cautionary Approach
The SEC has historically approached cryptocurrency-related investment products with caution. This stance aligns with TD Cowen’s predictions, as the investment bank believes the regulator will hesitate to approve Ethereum ETFs without external legal pressures, similar to those observed during the approval process of Spot Bitcoin ETFs. Scott Melker, a prominent crypto investor, shares this sentiment, stating that Ethereum Spot ETFs are unlikely to gain approval unless the courts intervene.
Adding another layer of complexity to the approval process, JPMorgan, an American multinational financial service firm, weighs in on the likelihood of Ethereum Spot ETFs gaining approval. Nikolaos Panigirtzoglou, Managing Director at JPMorgan, suggests that there is a 50% chance the SEC will approve these ETFs by the May deadline. However, he highlights the need for the SEC to classify ETH as a commodity, similar to Bitcoin, before granting authorization for Ethereum Spot ETFs.
Analysts hold different perspectives regarding the likelihood of Ethereum Spot ETF approvals. An analyst from Bloomberg, Eric Balchunas, offers a more optimistic viewpoint, stating a 70% chance of SEC approval for ETH Spot ETFs. Balchunas points out the inconsistency of approving Bitcoin-based ETFs while rejecting Ethereum-based counterparts. However, it is crucial to note that the SEC’s decision ultimately rests upon various factors and considerations.
The approval process for Ethereum Spot ETFs faces potential delays, according to TD Cowen and other market analysts. The SEC’s cautious approach, the need for external legal pressures, and JPMorgan’s complexity in approval contribute to the uncertainty surrounding the decision-making process. While there are differing opinions among industry professionals, investors and stakeholders must remain patient and monitor the progress closely. As the deadline approaches, it will become clearer whether Ethereum Spot ETFs will receive regulatory approval or face further delays.
Disclaimer: The article provided is for educational purposes only and does not represent the opinions of NewsBTC. Any investment decisions should be based on personal research and carried out at the individual’s own risk.
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