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Asset management executives anticipate a pivotal decision on the introduction of spot ethereum exchange-traded funds (ETFs) in the United States, with a consensus view that there is a 50% chance of regulatory approval by May 2023.
During a panel discussion on February 13, leaders from Bitwise Asset Management, Galaxy Asset Management, and Grayscale shared insights on the prospects for ethereum ETFs, marking an important moment for cryptocurrency investment products.
Bitwise's Matt Hougan expressed optimism and claimed a “50/50 chance by May” for the approval of an ethereum ETF, a sentiment echoed by Galaxy's Steve Kurz, who also suggested a 75% chance by the end of 2024.
Grayscale's Dave LaValle highlighted the uncertainty surrounding potential legal action against the US Securities and Exchange Commission (SEC) should its application be rejected, reflecting Grayscale's previous legal approach that led to the reconsideration of your bitcoin Spot ETF application.
The panel's outlook aligns with the forecasts of other industry experts. JP Morgan's Nikolaos Panigirtzoglou, Bloomberg ETF analyst James Seyffart, and Polymarket predictions suggest varying degrees of optimism, with estimates ranging between 48% and 60% for approval by the end of May.
Currently, Grayscale and Galaxy, in collaboration with Invesco, have pending applications with the SEC for an ethereum spot ETF, along with other prominent firms such as VanEck, ARK and 21Shares, Hashdex, BlackRock (iShares), Fidelity and Franklin Templeton. The SEC's decision on VanEck's request, scheduled for May 23, is highly anticipated and is expected to set a precedent for other similar proposals.
The US market has not yet welcomed an ethereum spot ETF, and existing investment vehicles are primarily focused on ethereum futures. Bitwise and other asset managers, including Grayscale, offer ethereum futures ETFs, which differ from direct exposure to the ethereum spot market. Grayscale, in particular, aims to convert its ethereum Trust and ethereum Futures Trust into ETFs, further emphasizing the growing interest in ethereum-based investment products.
