U.S.-based spot Bitcoin ETFs are very successful in the United States, but potential Ethereum ETF issuers aren’t feeling optimistic that a greenlight is coming soon as the decision date looms.

Skepticism Abounds For Ethereum ETFs

Ether, the industry’s second-largest crypto by market value, has been the subject of speculation for an SEC spot exchange-traded fund (ETF) greenlight ever since the agency’s Chairman Gary Gensler approved nearly a dozen spot Bitcoin ETFs in mid-January.

Investment giants like BlackRock, Fidelity, Franklin Templeton, and VanEck, which listed spot BTC ETFs, have already filed applications for an ETH investment vehicle, but now it seems that some are bracing for a potential rejection.

In an April 9 interview with CNBC, VanEck CEO Jan van Eck said his company’s spot ether ETF application will “probably be rejected.” Jan noted that VanEck was the first to submit paperwork for a spot ETH ETF alongside Cathie Wood’s ARK Invest, both of which are awaiting the SEC’s decision on May 23 and May 24, respectively.

“The way the legal process goes is that regulators will give you comments on your application and that happened for weeks and weeks before the Bitcoin ETFs, but now pins are dropping as far as Ethereum is concerned,” van Eck added.

Rocky Road For Ether ETFs

Ethereum has recently come under the spotlight after news emerged that the Ethereum Foundation is being investigated by an undisclosed state authority. Speculations suggest that this probe, potentially from the SEC, seeks to reclassify ETH as a security. 

SEC chair Gensler has previously suggested that ETH could qualify as a security following its historic shift to a proof-of-stake security model. This contradicts its counterpart, the Commodity Futures Trading Commission (CFTC), which has actually said on various occasions that it considers Ethereum to be a commodity.

Moreover, unlike the back-and-forth discussions that paved the way for spot Bitcoin ETFs, the dialogue between the potential issuers and the SEC regarding ether ETFs appears more one-sided. This lack of engagement suggests Ethereum ETFs are unlikely in the U.S.

Jean-Marie Mognetti, the CEO of CoinShares — a new entrant to the U.S. Bitcoin ETF space — also said he was pessimistic about the chances of ETH ETFs getting the go-ahead from the SEC. “I don’t see anything being approved this side of the year,” he told CNBC.

Lowered Odds

Bloomberg ETF analyst Eric Balchunas substantially dropped prospects of spot ether ETF approval in May from 70% to 35%, as ZyCrypto previously reported. As of April 8, Balchunas indicated that his estimates had not changed.

“As we’ve said, need SEC to give comments on the filing documents (the ‘critical feedback’ he mentions) and that still ain’t happening, even in person they offering nothing. Silence is violence,” Balchunas posited on X.

Balchunas’ colleague James Seyffart shared a similar take, stating that “zero comments/interactions is a bad sign.”