Coinbase urged the Securities and Exchange Commission to list Grayscale. Ethereum ETH
-2.72%
It’s trust in the deal, according to Paul Grewal, the company’s chief legal officer.
taking in Social Media Platform, Grewal announced that Coinbase had responded to the SEC’s request for comment. He said Coinbase provided the “legal, technical and economic basis” needed for approval.
“Our letter says what anyone who has paid any attention to the subject knows: ETH is not a security. In fact, before and after the merger, the SEC, CFTC and the markets did not treat ETH as a security. Security is a commodity.” Grewal said in his post.
Analysts expected the SEC to approve a spot Ether ETF as early as May of this year. Last October, Grayscale and NYSE Arca have applied to convert the Grayscale Ethereum Trust into a spot ether ETF. Several companies, including giants like BlackRock and Fidelity, have also applied for spot ether ETFs. Some of the applicants are aiming to generate additional income by staking native Ethereum.
Investing in a spot ether ETF allows investors to bet on the price of the second-largest cryptocurrency by market capitalization without having to purchase the underlying assets directly.
Spot Ether ETF Must Be Approved
In Grewal’s letter to
“ETH’s market depth, tight spreads, and price correlation across spot markets are highly indicative of the market’s resilience to fraud and manipulation,” Coinbase wrote in a letter to regulators. “ETH’s nominal dollar volume is significantly greater than that of most stocks that make up the S&P 500, even when adjusted for total market cap.”
“Coinbase serves as custodian for eight of the 11 recently approved U.S. Bitcoin ETFs and has been designated as a staking institution by three of the four largest non-U.S. Ethereum staking ETFs.” S&P Global Ratings Analysts Andrew O’Neill and Alexandre Birry said in a report published on Tuesday.
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