Issuers of Ethereum ETFs are required to file draft S-1 forms today

The SEC has ordered potential issuers to file amended S-1 forms by Friday, May 31, according to sources familiar with the matter.

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

Track Ethereum ETF approval progress

The recent approval of Forms 19b-4 marked an important milestone, achieved through a last-minute change in direction by the SEC. Consequently, the 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 confirmed that the SEC requested the draft S-1 filings today, Friday. After this submission, the agency will submit its first round of comments, which will result in further amendments. The launch of an Ethereum ETF requires the SEC’s approval of Forms 19b-4 and S-1, which typically undergo several revisions before final approval.

Until now, VanEck filed an amended Form S-1 on the day the ETFs were approved. BlackRock followed suit on May 30, detailing an initial investment of $10 million for its ETF.

While the details of seed investments are relatively straightforward, other aspects of the forms may require more time to deal with. The S-1 forms are expected to go through at least two more rounds of drafts before they are finalized.

Mixed feeling about the delays

Eric Balchunas previously noted that the completion of the S-1 registration statements could take longer, which could delay the launch of the spot Ether ETFs. “I don’t know how fast the fast track is, but it’s probably going to be a mad scramble for the next few days, maybe even weeks, it depends on the S-1,” he noted.

Despite the potential delays, JPMorgan analysts remain optimistic, anticipating that Ether ETF spot trading will begin well before November. They perceive ETF approval and the broader crypto landscape to be increasingly political ahead of the 2024 US presidential election.

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

— 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 that an immediate launch would have led to 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 having a huge impact, is a marginal positive that could attract early entries and benefit ETH’s price.

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