JP Morgan Reveals Potential Approval for Spot Ethereum ETF

Now that Spot Bitcoin ​​ETF Approved According to the U.S. Securities and Exchange Commission (SEC), more ETFs are expected to enter the market, especially in the cryptocurrency market. Find the Ethereum ETF.

Nonetheless, analysts at JP Morgan, an American multinational financial services company, expressed less optimistic views on the likelihood of approval of the Ethereum Spot ETF.

Ethereum spot ETF expected to be approved

In a note to clients published on Thursday, January 18, JP Morgan analysts, led by Nikolaos Panigirtzoglou, the financial services company’s managing director, said the expected Spot Ethereum ETF approved by the SEC.

Analysts cited regulatory and judicial reasons as the basis for their predictions, claiming that the likelihood of an Ethereum spot ETF being approved does not exceed 50%.

JP Morgan analysts said, “We agree with the above argument, but are skeptical that the SEC will classify ether as a commodity as early as May.”

Just last week, SEC Delay Fidelity approves Ethereum Spot ETF. The regulator postponed the decision date to March 5, 2024, citing more time needed for assessment. Application of Fidelity. additionally, deadline The SEC’s final decision on Spot Ethereum ETF applications extends from late January to August 2024.

The most crucial date that will provide a better outlook on the potential launch of these ETFs in the cryptocurrency market is the January 25 application deadline for Grayscale’s Ethereum Spot ETF.

Grayscale in early June 2022 took legal action Against the SEC for rejecting the Spot Bitcoin ETF. In August 2023, the asset management company victory was achieved The lawsuit comes after the U.S. Court of Appeals for Columbia Circuit ruled that the SEC erred in rejecting Grayscale’s application for a Bitcoin ETF.

With the SEC recently approving the Spot Bitcoin ETF in just a few months, Legal and regulatory issuesMany cryptocurrency enthusiasts expect A lengthy regulatory process would be required prior to potential approval of a Spot Ethereum ETF. If the Ethereum Spot ETF is approved by the SEC, it will provide investors with an unprecedented opportunity to gain exposure to cryptocurrencies without having to own them.

ETH bulls lose control to bears | Source: ETHUSD on Tradingview.com

Why the ETH spot ETF approval rate remains at 50%

Currently, the regulatory framework surrounding cryptocurrency in the United States is still surrounded by uncertainty. This includes XRP. got sued It received protection from the SEC in 2020 after the regulator classified it as a security. There were also many other cryptocurrencies held by the SEC. Identified as a security.

Potential approval of an Ethereum Spot ETF generally depends on the SEC’s classification of digital assets, whether they are commodities or securities. In January 2024, regulators Approved Ethereum Futures ETFEthereum is ‘implicitly’ accepted as a commodity.

If the SEC identifies Ethereum as a commodity, potential approval of the ETF application could become visible. But as JP Morgan analysts said, it could be quite some time before the SEC makes a decision.

Regulators have continued to take action. aggressive approach This is about cryptocurrency regulation in the United States. SEC Chairman After Spot Bitcoin ETF Approval Gary Gensler The agency has publicly declared that it still does not approve or support Bitcoin and classifies all cryptocurrencies as investment contracts subject to federal securities laws.

Featured image from Forbes, chart from Tradingview.com

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