The US Securities and Exchange Commission (SEC) held a meeting with representatives of Coinbase and Grayscale Ethereum Trust on March 6, 2024. The meeting was part of an ongoing dialogue between the SEC's Trading and Markets Division and the two cryptocurrency firms.
Commenting on the meeting, Eric Balchunas, a senior ETF analyst, expressed some concerns. “Normally I would say this is a good sign, but to my knowledge, the SEC has yet to make any comments to the ETF companies, which is not a good sign as we are past the time when they comment on Bitcoin ETFs,” he said.
Balchunas also noted that the SEC has not had a court defeat addressing this issue and that the correlation between futures and spot is not that strong, leading him to be less optimistic about the Ethereum ETF compared to the Bitcoin ETF.
Nate Geraci, another ETF analyst, offered a different perspective. He reiterated that the SEC met with Grayscale lawyers and Coinbase regarding the spot Ether ETF. According to Geraci, the call included an analysis of the correlation between futures and spot markets. “Coinbase analysis shows that the correlation between Ethereum futures and spot markets is as strong as it is in Bitcoin markets,” Geraci said. He also pointed out that the SEC has approved Ethereum futures ETFs traded on the CME, and stated that he was not sure what reasons there might be for not approving spot Ethereum ETFs.
*This is not investment advice.