Will the U.S. Approve a Physical Ethereum ETF? Summarizing Expert Opinions

Explore insights from JPMorgan, TD Cowen, and Bloomberg analysts on the likelihood of the U.S. approving a Physical Ethereum ETF.

Understand the complexities and predictions shaping the future of cryptocurrency ETFs.

Overview of Expert Perspectives on Physical Ethereum ETF Approval

Following the U.S. Securities and Exchange Commission's (SEC) approval of a physical Bitcoin ETF on the 11th of this month, anticipation is growing in the cryptocurrency industry for the approval of a "Physical Ethereum ETF."

Applications for a Physical Ethereum ETF have already been submitted by multiple companies, including BlackRock, Fidelity, VanEck, and Hashdex.

The results of applications from VanEck and Hashdex are scheduled to be announced in May 2024, but experts are divided on whether these ETF applications will be approved.

Nicholas Panigirtzoglou of JPMorgan

Nicholas Panigirtzoglou, an analyst at JPMorgan, reportedly told the cryptocurrency media outlet "The Block" that the likelihood of the SEC approving a Physical Ethereum ETF by May is less than 50%.

He stated that for the SEC to approve a Physical Ethereum ETF by May, ETH must be classified as a "commodity, not a security," similar to BTC. He believes the chances of Ethereum being classified as a commodity by May are less than 50%.

TD Cowen Research Group

The research group at the American investment bank TD Cowen has been reported as predicting that it will take some time for the SEC to approve a Physical Ethereum ETF.

The team suggests that the SEC might want to observe the aftermath of the physical Bitcoin ETF approval before approving other cryptocurrency ETFs.

They speculate that the approval might not take 26 months, but it could be delayed until after the presidential election in November.

The group also believes that legislation will be needed to establish frameworks for how tokens are regulated, what kind of disclosures are required, and which agencies will be responsible for investor protection.

Eric Balchunas of Bloomberg

Eric Balchunas, a Bloomberg ETF analyst, has reportedly said that the probability of a Physical Ethereum ETF being approved by May 2024 is 70%.

He stated that he cannot imagine a scenario where a physical Bitcoin ETF is approved, and a physical Ethereum ETF is not. Although the launch timeline is not clear, he has reported a 70% chance of approval.

James Seyffart, another Bloomberg ETF analyst, pointed out that the SEC has implicitly accepted Ethereum as a commodity by approving the Ethereum Futures ETF, suggesting a high likelihood of approval for a Physical Ethereum ETF.

Mark Yusko of Morgan Creek Capital

Mark Yusko, co-founder and CEO of Morgan Creek Capital, in an interview with the cryptocurrency media "Cointelegraph," stated that the probability of a Physical Ethereum ETF being approved in the U.S. in 2024 is less than 50%.

He mentioned the SEC's hostile stance as indicated by Gary Gensler, the chairman of the SEC, who emphasized that the approval of the physical Bitcoin ETF was limited to Bitcoin and did not indicate an intention to approve other cryptocurrency ETFs.

Yusko also pointed out the possibility of the SEC considering Ethereum as a security. Although the SEC had previously stated that Ethereum is not a security, there have been subsequent statements suggesting otherwise.

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