Coinbase’s Paul Grewal seeks the SEC not to restrict Ethereum ETFs, citing the SEC and CFTC’s previous identification of Ethereum as a commodity.
Legislators in the United States have placed considerable pressure on the U.S. Securities and Exchange Commission (SEC) to halt the approval process for the spot Ethereum ETF.
The likelihood of Ether ETF approval has diminished as the SEC considers classifying the altcoin as a security.
However, industry participants have come out in support of Ethereum.
Coinbase Executive Calls for Spot Ethereum ETF
Paul Grewal, Coinbase’s Chief Legal Officer, commented on the persistent rumors and false information about Ethereum (ETH) amid anticipation of a ruling on Ethereum Exchange-Traded Products (ETPs).
Grewal underscored fundamental information regarding ETH, including its extensive ownership by millions of Americans since its inception in 2015 and its indispensable function within the cryptocurrency ecosystem.
He reaffirmed that the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) recognize ETH as a commodity, with former SEC chair Gary Gensler and senior SEC officials attesting to its non-security status.
Ex. A. Senior SEC officials have said ETH is not a security, see e.g. SEC Director of Corporation Finance Hinman’s statement https://t.co/efXqCx4iyw 3/10
— paulgrewal.eth (@iampaulgrewal) March 20, 2024
Grewal emphasized that the differentiation between ETH’s classification and the conventional Howey test employed to identify securities is significant.
Following this framework, ETH does not comprise an investment contract or security, he added.
In addition, he underscored the regulatory treatment of ETH as consistent, which includes its listing on futures exchanges regulated by the CFTC since 2021.
Given the established regulatory stances, Grewal strongly advised the SEC against establishing superfluous barriers for ETH ETP applications.
Moreover, Grewal emphasized the fact that questioning the regulatory status of ETH would betray investor confidence and run counter to a long-standing precedent.
He placed considerable emphasis on the importance of adhering to established legal principles to benefit all parties involved.
SEC Requires Additional Time For Evaluation
The US SEC postponed its verdict regarding the approval of the VanEck spot Ethereum ETF on Wednesday, March 20.
However, the new deadline for a verdict has been extended to May 23, 2024.
This extension, which follows a sequence of similar postponements for other Ethereum-based ETF applications, indicates a prudent stance towards regulatory matters.
As per recently revealed SEC documents, the organization has decided to provide further time for the evaluation of VanEck’s proposal for a spot Ethereum ETF.
The purpose of the extension is to provide the commission with the opportunity to thoroughly examine the proposed rule change and resolve any possible issues that may emerge throughout the evaluation procedure.
