Ethereum ETF Issuers Must Submit Draft S-1 Forms Today

According to sources familiar with the matter, the SEC has instructed prospective issuers to submit amended S-1 forms by Friday, May 31st.

This follows the approval of the 19b-4 forms on May 23, marking a significant milestone in the process.

Spot Ethereum ETF Approval Progresses

The recent approval of the 19b-4 forms marked a significant milestone, achieved through a last-minute change in direction from the SEC. Consequently, issuers had not prepared their S-1 forms in advance. Despite this, progress is being made, with the SEC now actively engaging with issuers to finalize these forms.

Sources familiar with the situation have reportedly confirmed that the SEC requested draft S-1 filings by today, Friday. Following this submission, the agency will provide its first round of comments, leading to further amendments. Launching an Ethereum ETF necessitates SEC approval of the 19b-4 and S-1 forms, which typically undergo several revisions before final approval.

So far, VanEck submitted an amended S-1 form on the day the ETFs were approved. BlackRock followed suit on May 30, detailing a $10 million seed investment for its ETF.

While the details of seed investments are relatively straightforward, other aspects of the forms might require more time to address. The S-1 forms are expected to undergo at least two more rounds of draft filings before they are finalized.

Mixed Sentiment Over Delays

Eric Balchunas previously pointed out that finalizing the S-1 registration statements could take additional time, potentially delaying the launch of spot Ether ETFs. “I don’t know how fast the fast track is, but it’s going to be probably a mad scramble for the next couple of days, maybe even weeks—depends on the S-1,” he noted.

Despite potential delays, JPMorgan analysts maintain optimism, anticipating the spot Ether ETF trading will commence well before November. They perceive the ETF approval and broader crypto landscape as increasingly political leading up to the 2024 U.S. presidential election.

JPM: “The issuers’ registration statements remain under review by the SEC. As such, there is no anticipated date on when these ETFs will begin trading.
We note Galaxy analysts anticipate that S-1s will be finalized and trading may start in July or August 2024. We note this…

— matthew sigel, recovering CFA (@matthew_sigel) May 24, 2024

Split Capital co-founder Zaheer Ebtikar noted that the unexpected approval caught many off guard, and an immediate launch would have caused more volatile price action. He noted that the delay allows traders to anticipate and prepare for potential inflows.

GSR Research Analyst Brian Rudick added that the delay, while not highly impactful, is a marginal positive that could attract early inflows and benefit ETH’s price.