JPMorgan predicts that trading of the recently approved spot Ethereum ETFs will begin much earlier than November. The company views the approval of these ETFs and the overall cryptocurrency market as increasingly political issues, especially ahead of the 2024 US presidential election.
“We expect trading of the Spot ETH ETF to begin before November,” a team of JPMorgan analysts led by Kenneth Worthington said in a report published today.
On Thursday, the U.S. Securities and Exchange Commission (SEC) approved forms 19b-4 of eight spot Ethereum ETF applications. These include Grayscale, Bitwise, BlackRock, VanEck, Ark 21Shares, Invesco, Fidelity and Franklin.
All approvals were granted in a single mass order. However, these ETFs’ S-1 filings are still awaiting SEC approval before trading can begin. Many analysts predict that trading will begin in the coming weeks.
The SEC’s approval of ETH ETFs comes after it reconvened with stakeholders earlier this week after months of deliberations.
The approval of spot Ethereum ETFs likely occurred because issuer companies removed staking-related language from their 19b-4 forms. Staking is a contentious issue between fund issuers and the SEC. It remains unclear whether an issuer staking ETH on behalf of an ETF investor creates an investment contract and therefore a security under the Howey test.
“Discussions around staking are likely to continue, as we understand that the focus right now is whether these issuers will be able to keep such staking rewards for themselves,” JPMorgan analysts said.
The approval of the ETH ETF coincided with the US House of Representatives passing the Financial Innovation and Technology for the 21st Century Act, also known as the FIT 21 bill. Analysts said the following on the subject:
“But the bill has less chance of passing the Senate, and the Biden administration has said it does not support the bill, but has not yet threatened a veto.”
*This is not investment advice.
