Fintech
US SEC Approves Ethereum Spot ETFs: Cryptocurrency Momentum Grows
Reacting to the SEC’s early approval of Ethereum ETFs, Alex Saleh, Head of Partnerships at Coincover, says: “This is a welcome surprise given the challenges of approving Bitcoin ETFs and the SEC’s historic hostility towards cryptocurrencies.
“The United States is the largest ETF market in the world, and where the United States moves, others usually follow. The launch of Ethereum ETFs still needs to go through a second phase of approval, but if given the green light, it would represent an important vote of confidence in the role digital assets will play in our financial system and open the door to many of them. products.”
Additionally, the SEC’s move may be a nod to the trading success of spot Bitcoin ETFs thus far, with cryptocurrencies having become wildly popular among lay investors willing to take on more risk in what has otherwise been a struggling investment landscape in the last two years.
Alex continues: “The SEC’s move is another sign of the growing appetite for crypto ETFs and could introduce new demand pressure on Ethereum spot prices as exposure to Ethereum would be opened up to a larger pool of investors.
“This is an exciting time for the crypto community, but there are still risks associated with any new financial instrument. Volatility is a given and the widespread adoption of Ethereum ETFs would lead to fund managers accumulating large amounts of Ethereum through a variety of custody methods This will be a prime target for hacks, attacks and possible human error.
“We expect higher expectations in terms of risk mitigation and security capabilities, which means that security is paramount and must be a top priority for ETF managers.”
However, not all reactions to the SEC’s latest announcement have been uniform and, where Alex Saleh sees the introduction of Ether spot ETFs as a welcome surprise, Bitpanda co-founder and CEO Eric Demuth, while welcoming the announcement, he calls it “highly anticipated”. ”.