Key points:

  • The SEC sent a request to the Nasdaq, CBOE and NYSE exchanges asking them to finalize their applications for listing spot Bitcoin ETFs.
  • This could signal the SEC’s readiness to approve such applications.
  • The price of ether rose 18% on Monday and another 8.6% to $3,802 by the end of Tuesday.

The US Securities and Exchange Commission (SEC) has sent a request to the Nasdaq, CBOE and NYSE exchanges asking them to finalize their applications to list bitcoin-based spot exchange-traded funds (ETFs). This action may signal the SEC’s readiness to approve such applications.

Rumors around new products support Ethereum rally

While listing applications are just the first step in a two-tier approval process, the SEC’s approval would be a significant and unexpected win for the cryptocurrency industry, which had previously expected a denial.

Ether rose 18% on Monday and then another 8.6% to $3,802 late Tuesday, before correcting slightly to hover around $3,747 Tuesday afternoon.

The SEC will have until the end of this week to decide whether to approve CBOE’s applications to list the Ethereum ETFs filed by VanEck and ARK Investments/21Shares.

SEC requirements

On Monday, May 20, SEC officials unexpectedly required Nasdaq, the CBOE and the NYSE to make urgent changes and updates to reports that are standard procedure before approval, people familiar with the process said.

It is worth noting that exchange trading applications require SEC approval for rule changes necessary to list new products. However, issuers still require ETF registration agency approval before they can begin trading.

Unlike stock trading applications, registration applications do not have a set time frame for SEC review. This means it could take several months for Ether-ETF trading to begin.

Chances of Ether ETF approval

After the SEC approved ETFs based on Ethereum futures in October, issuers began submitting the first applications for Ethereum spot products. However, market participants had expected the SEC to reject these applications, citing disappointing and controversial meetings with the regulator.

It’s worth noting that the US Securities and Exchange Commission (SEC), under the leadership of crypto skeptic Gary Gensler, rejected applications for spot Bitcoin ETFs for more than a decade, citing concerns about market manipulation. But last year the SEC was forced to approve them after a lawsuit won by Grayscale Investments.

The new Bitcoin ETFs have attracted the attention of a wide range of investors, including hedge funds, wealth advisors and retail investors. In the first week, these two funds were able to raise more than $1 billion.