Illustration shows representation of Ethereum with its native cryptocurrency ether
Ether users are anticipating the launch of spot ETH ETFs, but the SEC is taking its "sweet" time to fully approve the funds. Reuters

KEY POINTS

  • Bloomberg's Balchunas revealed the latest round of comments were 'light'
  • He floated the idea of a potential 'problem' issuer within the pool of ETH ETF applicants
  • Some crypto users said launching around the July 4th holiday wouldn't be the best time

As the Ethereum community anticipates the nearing full approval of spot Ethereum ($ETH) exchange-traded funds (ETFs), new details have emerged about progress in the U.S. Securities and Exchange Commission's (SEC) processing of S-1 filings.

SEC provides very light comments

Senior Bloomberg ETF analyst Eric Balchunas revealed Wednesday night that he heard the SEC's latest round of comments were "literally nothing" and "took zero time [for applying issuers] to update." The news suggests that the Wall Street regulator, whose leadership has been dubbed anti-crypto by the burgeoning industry, is not giving as much trouble to applicants as it did with the 19b-4 filings.

On the other hand, the amended S-1 filings of individual issuers did not include their management fees yet. Balchunas said the documents with updated fees will probably be filed sometime next week.

Balchunas, a well-followed figure in the crypto space, reiterated that it is unclear why the SEC "is taking its sweet time" in getting the approval process completed, considering "how light the comments were." He went on to note that spot Ether ETFs could have easily been fully approved for trading by now.

An issue with an issuer?

However, he suggested that there could be a "'problem' issuer slowing down [the] process." An X user said that the "problem issuer" may have taken into consideration that launching during the holiday week would not have been the best time to go live. Another user agreed, saying no issuer would want "a flop of a first few trading days."

Bitwise attempts to meet VanEck halfway in amended S-1

Bitwise Invest, one of the applicants for a spot ETH ETF, on Wednesday, filed an amended S-1 form, wherein it noted it will waive the yet-to-be-disclosed management fee for the first $500 million going into its ETF.

Notably, applying issuer VanEck was the first to announce that it would waive management fees, setting the tone for how other applicants are expected to go about in the first months following the funds' launch. VanEck will waive the fee either for an unspecified period from 2024 through 2025 or for the first $1.5 billion in inflows before it charges a 0.20% fee.

So when will the funds go live?

Bloomberg analysts initially predicted S-1 filings to be approved sometime around the July 4th holiday. However, they pushed back the prediction to after the holiday celebrations.

For Steve Kurz, Galaxy Digital's global head of asset management, it will take "weeks," but still within the month of July. Crypto investor Nick believes the full approval will be announced in the least expected time.

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