US Securities and Exchange Commission (SEC) spot Ethereum is reportedly on the verge of approving exchange-traded funds (ETFs). This sudden change left companies trying to understand the SEC’s change of attitude in a difficult situation.
Just two weeks ago, the SEC showed no interest in the filings, according to a source familiar with the matter. However, on Monday, the SEC’s trading and markets division notified exchanges that they would approve 19b-4s this week. This news coincides with reports from Barrons’ SEC staff indicating a trend toward approval.
The source described the situation as “completely unprecedented” and claimed that this U-turn was “purely political”. This speculation stems from a lack of internal coordination within the SEC. While the trading and markets division is preparing to approve 19b-4s, the corporate finance division, which is responsible for S-1s, appears out of sync on this issue.
The source also speculated that the SEC’s change of heart could be politically motivated, given the fast-approaching elections. Former President Donald Trump, who recently lent his support to crypto, told a crowd of NFT buyers, “In any form crypto coins “If you love it, you better vote for Trump,” he said.
The source believes this could become a campaign issue, especially since Democrats desperately need the youth vote. The source suggested that President Joe Biden could score a win with the approval of spot ETH ETFs and position himself as a leader going forward.
The next step involves updating the 19b-4 forms once comments are received from the SEC. Given the tight deadlines, comments on 19b-4s are expected to be light. The source emphasized the urgency of the situation, likening the SEC’s efforts to “writing a term paper the night before the deadline.”
*This is not investment advice.
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