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Dogecoin founder Billy Markus said that SEC has lost its integrity, and any positive outcomes are unlikely until its integrity is restored.
The wait is almost over for the crypto industry as the US Securities and Exchange Commission (SEC) prepares to deliver its verdict on applications for Ethereum-based exchange-traded funds (ETFs). With decision dates set for May 23rd and 24th for applications from VanEck and ARK Invest, respectively, anticipation is high, but skepticism lingers.
This skepticism is fueled by recent comments from Dogecoin co-creator Billy Markus, who expressed pessimism about the chances of approval due to the SEC’s “compromised” state. Markus’s remarks align with concerns raised by financial lawyer Scott Johnsson, who highlights Ethereum’s classification as a security-like asset, unlike Bitcoin, which has already secured ETF approvals.
“I don’t think it’s that important personally. The SEC is compromised anyway, nothing good will come out of it until the house is cleaned,” said Markus.
SEC Reluctance on Ethereum ETFs
According to Roshan Shah, the Co-founder and CEO of Decimal Digital Currency, the regulators are not yet ready to approve Ether ETFs. Investors in ETFs have started to understand Bitcoin recently, whereas the situation of Ether is quite complex.
Gensler, the Chair of the SEC, has publicly referred to Bitcoin as a commodity rather than a security. Consensys, a blockchain company, filed a lawsuit against the SEC in April. The primary objective of the lawsuit is to prove in Court that Ether is not security.
Shah has also expressed his doubts about another reason regulators are not approving Ether ETF. Shah wrote in the E-mail that regulators worry that the Bitcoin ETF will become a significant door for access to the public market for various other digital assets.
Investor Sentiment and Market Impact
Despite the 24.73% discount in Grayscale Ethereum Trust (ETHE), a closed-end fund, the price of ETH is far below its face value as of May 16. This marks a lack of confidence in the possible approval to launch an ETF. Contrarily, Grayscale Bitcoin Trust (GBTC) showed a reduction in the discount last year, supporting the argument for ETF conversion.
A downfall in Ethereum price is expected in the short term as the majority of investors are moving their attention to Bitcoin. Although Ether saw an impressive 61% surge in price in the last year, it is way behind Bitcoin, which reflected the investor skepticism even more with its outstanding 142% uptick in price.
The May 23 and 24 resolutions will be the focal point for the Ethereum community. Even though regulatory hurdles remain, the potential for legal disputes and future securities approvals remains a primary hope for wider Ethereum adoption.
