KEY POINTS
- Sen. Hagerty pressed Gensler on why the process of approving crypto ETFs was taking so long
- The senator said spot Ether ETFs should be 'completely' approved after Gensler said 19b-4 filings were approved
- CFTC Chair Rostin Behnam directly answered 'yes' when asked if Ethereum is a commodity
The U.S. Securities and Exchange Commission (SEC) on Thursday revealed that he sees spot Ethereum (ETH) exchange-traded funds (ETFs) being launched sometime this summer, but he has yet to clarify the status of the Ether digital asset as a security or a commodity.
Speaking before the Senate Appropriations Committee, the SEC chief said he sees the approval of S-1 filings lodged by individual issuers to be announced "over the course of this summer." The Wall Street regulator recently approved 19b-4 filings of exchanges seeking to trade and sell the funds, but didn't provide an update until Thursday regarding progress in getting the S-1 documents of applying issuers. "That's working smoothly," he said of the registration process.
Sen. Bill Hagerty, R-Tenn., initiated the discussion regarding ETFs, pointing out the "years-long" process of getting spot Bitcoin ETFs approved. He said he was confused as to why Ether ETFs have not yet launched.
Hagerty first asked Chairman of the Commodity Futures Trading Commission (CFTC) Rostin Behnam whether ETH is a commodity, to which Behnam said, "yes." He asked the same question to Gensler, who, as he did during a House subcommittee hearing last year, did not directly provide an answer.
Instead, Gensler said the SEC did approve spot ETH ETFs, but Hagerty argued that it was only a partial approval. The SEC chairman was explaining the process when Hagerty cut him off and insisted that "Ether needs to be approved as well, completely."
Blockchain tech firm Consensys revealed in a recent legal filing that the SEC had already deemed ETH a security before Gensler refused to clarify the cryptocurrency's status. Several House lawmakers criticized the regulator after the revelation, with GOP majority whip Tom Emmer saying the "regulatory dishonesty" in the Ethereum issue was "reprehensible."
Earlier this month, Gensler also refused to answer whether Ether is a security or a commodity, rejecting that the issue was a "fundamental question" in the crypto space at this time.
Last week, he said the approval timeline for spot Ethereum ETFs would largely depend on the responsiveness of individual issuers. He also reiterated at the time that he still deems the crypto industry as rife with fraud and scams.
For Kaiko Research's head of indices, Will Cai, the SEC already "implicitly stated" that Ether, minus staking, is a commodity following the approval of 19b-4 filings. Still, the crypto market has long demanded that Gensler himself or the SEC explicitly state Ether's commodity or security designation for regulatory clarity.
