Industry sources cited by Reuters have indicated that the US Securities and Exchange Commission (SEC) is likely to reject applications for Ethereum-based spot exchange-traded funds (ETFs) next month. If this decision is negative, experts believe it could have a significant impact on the value of ETH, the leading altcoin.
The SEC is expected to make a final decision on these applications on May 23 and 24. After mandatory discussions with the involved parties, it appears that the SEC is preparing to deny the requests to offer an Ethereum-based spot ETF. This news has raised concerns in the crypto world, as it highlights the regulatory challenges faced by new crypto-based financial investment tools.
The expected denial of applications for Ethereum spot ETFs is due to the increased scrutiny surrounding the regulatory framework governing financial products related to ETH. The SEC’s classification of Ethereum as a security is a major hurdle for the altcoin in the cryptocurrency market.
A negative decision from the SEC regarding spot ETFs could have a major impact on the value of ETH. While experts have been anticipating more rejections than approvals, an official denial from the US regulator could put pressure on prices and result in a significant downward movement.
Prior to the news of the SEC’s likely denial, ETH was already trading down about 3%. The selling pressure on ETH intensified following Reuters’ report, and as of now, the altcoin is trading at $3,084, representing a 5.63% decrease over the last 24 hours. Experts believe that the $3,000 level is a crucial threshold for ETH, and in order to prevent further decline, the price needs to remain above this level.
Disclaimer: This article does not provide investment advice. Investors should be aware of the high volatility and risk associated with cryptocurrencies and should conduct their own research.
