SEC is concerned about the centralization of Ethereum PoS and delays Grayscale ETHE’s plan to convert into a spot ETF

The market is generally optimistic about the approval of the Ethereum spot ETF, especially after the United States approved the Bitcoin spot ETF. However, the U.S. Securities and Exchange Commission (SEC) said they are still carefully considering the proposal. Previously, applications from Fidelity and BlackRock were also delayed. Recently, the SEC delayed Grayscale’s application to convert its Ethereum Trust Product (ETHE) into a spot ETF.

Questioning that the PoS mechanism is susceptible to manipulation

According to the document, the SEC issued an order yesterday (25th) requesting that the proposal be initiated and solicit public opinions.

In addition, the SEC also specifically asked about Ethereum’s proof-of-stake mechanism in the document, and proposed whether the “concentration of control or influence” of ETH by an individual or entity may make the fund vulnerable to deception and manipulation. risks of. According to the SEC, the public comment period is 21 days and the rebuttal period is 35 days.

SEC raises concerns about ETH PoS mechanism and centralization

The key date is May 23

Before grayscale, SEC passed A decision on an ethereum spot ETF proposed by BlackRock and Fidelity was also delayed during the week. Currently, analysts have both optimistic and pessimistic views on whether a spot Ethereum ETF is about to be approved.

Some believe that the SEC may approve a spot Ethereum ETF as early as May, following its approval of a spot Bitcoin ETF this month. However, Bloomberg ETF analyst James Seyffart said that the SEC Delays to the spot Ethereum ETF may occur at irregular intervals over the coming months, with the next key date being May 23.

The question of whether ETH is a security has become a key factor in the adoption of spot ETFs. Looking at all cryptocurrencies, only Bitcoin is currently regarded by the SEC as a commodity with value storage capabilities, while Ethereum may still be listed. As securities, this is another major obstacle that will prevent the SEC from passing the Ethereum ETF.

It’s worth mentioning that when it comes to whether Gensler’s opaque stance regarding ETH as a potential security will play a role in the decision, the fact is that the U.S. Commodity Futures Commission (CFTC) prefers to treat ETH as a commodity. Coupled with Ripple's partial court victory last year, the ruling that $XRP is not a security when traded in secondary markets will make it an uphill battle for "Gensler to take the position that most digital assets are securities." ”.

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