Paul Grewal, the Chief Legal Officer of Coinbase, announced that they have responded to the Securities and Exchange Commission’s (SEC) request for comments on the application to convert the Grayscale Ethereum Trust (ETHE) into an Ethereum spot ETF. They have provided three main reasons to urge the SEC to approve the application.
Firstly, they argued that ETH is not a security. In fact, both the SEC, Commodity Futures Trading Commission (CFTC), and the market no longer consider ETH as a security after the merger, but rather as a commodity.
Secondly, they highlighted the strong governance capabilities of Ethereum’s Proof of Stake (PoS) system, which exhibits strong characteristics in terms of ownership concentration, consensus, liquidity, and governance. This reduces the risk of fraud and manipulation.
Lastly, they pointed out that economic data indicates that ETH is as resilient as BTC in meeting the approval standards for SEC ETP.
Paul Grewal stated that Coinbase is committed to making informed regulatory decisions, supporting innovation, and fostering a transparent, secure, and inclusive financial ecosystem through continuous dialogue and research in the rapidly evolving cryptocurrency environment.
As for the timeline, several institutions, including BlackRock, Hashdex, ARK 21Shares, VanEck, and Fidelity, have submitted a total of 8 applications for Ethereum spot ETFs to the SEC. In recent weeks, the SEC has been postponing the decision deadlines for Ethereum spot ETF applications from Fidelity, BlackRock, Grayscale, Invesco/Galaxy, and others.
Analyst James Seyffart from Bloomberg previously stated that he expects the SEC to further delay the decision deadlines for more Ethereum spot ETF applications in the coming months. The only important date for Ethereum spot ETFs is May 23rd, as it is the final approval deadline for VanEck’s application.
Geoffrey Kendrick, the Head of Foreign Exchange at Standard Chartered Bank, predicted in a report last month that Ethereum spot ETFs would ultimately be approved for listing on May 23rd, as it is the final deadline for the first batch of related ETF applications, and by then, the ETH price is expected to reach $4,000.
sassal.eth, the co-founder of EthHub, also tweeted today expressing belief that the Ethereum spot ETF will be approved before May 23rd.