SEC Plans to Hasten Ether Futures ETF Launch: Bloomberg ETF Analyst

With the odds of a US government shutdown increasing by the day, the Securities and Exchange Commission (SEC) is reportedly looking to expedite Ethereum Futures exchange-traded funds (ETFs) approvals, according to senior Bloomberg analyst Eric Balchunas.

Meanwhile, the SEC remains hesitant to approve spot Bitcoin ETF applications, with the agency recently delaying its decision on a couple of filings.

An Ethereum Futures ETF Likely to Launch Soon

Eric Balchunas said the SEC has given filers 48 hours to update their applications, which elapses on the afternoon of Sept. 29, to enable the ETF products to go effective on Oct. 2 and begin trading on Tuesday, Oct. 3, 2023.

Balchunas, along with fellow Bloomberg ETF analyst James Seyffart, predicted in a previous tweet that there was a 90% chance that Ether futures ETFs will begin trading in early October, with Valkyrie’s Bitcoin and Ether ETF set to be first in line.

UPDATE: Hearing the SEC wants to accelerate the launch of Ether futures ETFs (bc they want it off their plate bf shutdown) so they’ve asked the filers to update their docs by Fri pm (no small task to jam into 48hrs, esp for indie issuers), so they can go eff Mon and trade Tue. https://t.co/gKyQFK12aM

— Eric Balchunas (@EricBalchunas) September 28, 2023

Valkyrie applied with the SEC to change the investment strategies of its current Valkyrie Bitcoin Strategy ETF to include exposure to ether futures contracts. Meanwhile, Seyffart and Balchunas anticipate that the first pure Ether futures-based ETF product will come from Volatility Shares, expected to become effective on Oct. 11 and launch on Oct. 12.

However, both Bloomberg ETF analysts predict that not all the 15 Ethereum futures ETFs filed by 11 applicants will launch. Apart from Valkyrie and Volatility Shares, some of the issuers include Grayscale, VanEck, Bitwise, and ProShares.

When Spot Bitcoin ETF?

Balchunas, in his latest update, disclosed that the SEC wanted to fast-track Ether futures ETFs launch ahead of a possible government shutdown in the United States. The shutdown could begin on Sunday, Oct. 1, if Congress fails to pass the funding legislation before the end of September.

SEC chief Gary Gensler already said the Commission will operate with a skeletal staff if the government shutdown eventually happens. According to him at a hearing on Sept. 27, over 90% of its employees will face “unpaid furloughs,” leaving the little remaining staff to carry out essential functions, while responses to whistleblower complaints and investigations “will grind to a halt.”

As the SEC is reportedly making plans to green-light some Ethereum futures ETFs, all spot Bitcoin ETF applications could remain pending if the government shutdown happens.

To date, the SEC has yet to give its blessings for a spot Bitcoin ETF in the United States, while it has approved BTC ETFs based on futures. Recently, four US lawmakers urged the American regulatory agency to immediately approve spot BTC ETFs, stating it made no sense for the regulator to continue to favor futures ETFs over spot products, as there was no clear difference between the two.

The SEC later delayed its decision on filings from Ark Invest and 21Shares, and Global X, with the former extended to January 2024. Other spot Bitcoin ETF applications are due later in October.

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