TD Cowen estimates that SEC approval of Ethereum ETFs will not come until 2025 at the earliest. Analysis of a revealing forecast of regulatory barriers to cryptocurrencies.
Ethereum ETF, An approval complicated by political issues
In a recent note, analysts at the investment bank TD Cowen are pessimistic about the imminent authorization of Ethereum spot ETFs by the Securities and Exchange Commission (SEC), the American stock market regulator.
TD Cowen believes that political calculations on the part of Gary Gensler, Democratic president of the SEC, will push him to postpone this sensitive decision beyond 2024. The idea being not to offend the left wing of his party, very suspicious of cryptocurrency.
An initial rejection that would push back the deadline
Concretely, TD Cowen is counting on a rejection by the SEC of the first applications for direct Ethereum ETFs, in particular that filed by VanEck. Following this refusal, new files will have to be created by the financial players concerned.
Between the filing of new applications, their examination by the SEC and possible legal recourse in the event of rejection, TD Cowen estimates that the green light for a spot Ethereum ETF will not come before the end of 2025, or even early 2026.
A stark contrast to Bitcoin ETFs
This forecast contrasts sharply with the recent approval by the SEC of the very first ETFs backed directly by the price of Bitcoin. However, Gary Gensler also faced strong criticism on this issue from Democrats.
But with his caution regarding Ethereum, the head of the SEC seems to be learning lessons from the Bitcoin ETF controversy. He will obviously not take the risk of a new confrontation with his camp before the end of his mandate.
The slow removal of regulatory obstacles
TD Cowen’s analysis highlights the political and regulatory obstacles that still hinder the arrival of crypto investment products in the United States. Despite advances like Bitcoin ETFs, there is a long way to go before smooth integration of crypto-assets.
The green light for Ethereum ETFs, probably not before 2025, will be another decisive step. The SEC and its president nevertheless seem determined to take their time before completely opening up crypto finance to mainstream investors.
According to TD Cowen, patience remains essential before seeing the first Ethereum ETFs land. The bank does not expect approval by the SEC before at least 2025, due to political calculations. A cautious timetable that contrasts with the recently authorized Bitcoin ETFs.
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