The U.S. Securities and Exchange Commission is more likely now to approve so-called 19b-4 applications for spot ether ETFs later this week, said ETF analysts at Bloomberg Intelligence.
Bloomberg analysts raised the odds of approval to a 75% chance, a dramatic increase from a 25% chance previously. In a May 20 post on X, formerly Twitter, Bloomberg Intelligence Senior ETF Analyst Eric Balchunas said he and Bloomberg Intelligence ETF Research Analyst James Seyffart revised their expectations after “hearing chatter this afternoon that SEC could be doing a 180 on this.”
On May 20, CoinDesk reported that the SEC had asked exchanges to update 19b-4 filings relating to proposed ether ETFs ahead of a key deadline this week.
The SEC designated May 23 as the date by which it shall either approve or disapprove a proposed rule change filed with it by the Cboe BZX Exchange to list and trade shares of the VanEck Ethereum ETF.
Similarly, the SEC designated May 24 as the date by which it shall either approve or disapprove a proposed rule change related to the ARK 21Shares Ethereum ETF, another of the spot ether ETF hopefuls.
Balchunas said Bloomberg Intelligence has heard that the 19b-4s are due back to the SEC by May 21.
“So, everything is in like a fire drill mode, and that’s obviously good,” he said. “Everything’s in hurry-up offense right now and that means they want to get it done because the 23rd (is) the deadline, so my guess is Wednesday or Thursday we’ll have the approval of the 19b-4s.”
SEC shift a 'total shock'
To Balchunas and other analysts with whom he’s spoken, the apparent shift at the SEC regarding the proposed spot ether ETFs “came as a total shock,” Balchunas said.
“Everybody was prepared and braced for denial, and I think what changed is this became an election issue,” he said, adding that “the (Biden) administration and the SEC may not want it to look like they’re anti-crypto.”
Balchunas emphasized, however, that 19b-4 approval wouldn’t mean that such ETFs could start trading right away.
“After the 19b-4s are done, then the S-1s also have to be approved,” he said. “There is no timeline yet, but my guess is they’ll happen pretty quickly after as well, then they can trade.”
