The Securities and Exchange Commission (SEC) may soon assert that Ethereum is a security in its expected rejections of several spot Ethereum ETF applications, a lawyer who specializes in digital assets warned Tuesday.The regulator is due to decide on VanEck’s application for such a product on May 23, followed by a final decision deadline for ARK Invest/21Shares’ application the next day. BlackRock, Fidelity, and Grayscale also have In March, the SEC put forth potential “grounds for [the] disapproval” of BlackRock’s application and Nasdaq’s proposal to list BlackRock’s product. One question the SEC posed in its Requiring that trusts hold a “specified commodity,” Scott Johnson, a general partner at Van Buren Capital, “The obvious purpose is to potentially deny on the basis that these spot filings are improperly filed as commodity-based trust shares and do not qualify if they are holding a security,” he wrote on Twitter.Rather than indirectly excluding the digital asset as a commodity, the SEC could explicitly assert that Ethereum is a regulated security in its expected ETF denials. But that’s “highly unlikely,” Terrence Yang, a managing director at Swan Bitcoin told “Gensler and his team, they’re political animals,” he said, arguing that the political backdrop surrounding crypto has grown too tense for a move that would likely spark backlash from crypto-friendly politicians, including Following the SEC’s Even though SEC Chair Gary Gensler has publicly affirmed that Bitcoin is a commodity, the Wall-Street cop has been Last month, a lawsuit filed by the Ethereum software company Consensys Prior to its approval of spot Bitcoin ETFs in January, the SEC denied similar applications Eventually, a federal appellate court “They can do it, but they should expect to get sued, and I think they’ll get attacked politically through the heavy lobbying that the well-funded crypto industry has,” he said.Edited by Ryan Ozawa.
