Grayscale’s CLO Asserts Inevitability of Ethereum ETF Approval
Grayscale’s Chief Legal Officer (CLO), Craig Salm, is highly optimistic about the approval of spot Ethereum exchange-traded funds (ETFs). Despite ongoing regulatory discussions, Salm believes that the case for Ethereum ETFs is just as strong as it was for Bitcoin ETFs. He draws parallels with past engagements on Bitcoin ETFs, highlighting positive dialogues with the Securities and Exchange Commission (SEC).
Salm firmly believes that Ethereum ETFs should be approved and is not deterred by the recent chatter surrounding them. He emphasizes the importance of viewing the perceived “lack of SEC engagement” at this point. To support his belief, Salm refers to productive discussions on Bitcoin ETFs, which focused on creating and redeeming ETFs, safe asset storage, and the roles of authorized participants (APs) and lenders for control.
Furthermore, Salm reveals that discussions on Ethereum ETFs involve operational and legal aspects similar to Bitcoin ETFs. He argues that the underlying principles governing ETF activity remain the same regardless of the asset. With most of the basic framework and regulatory structure already in place, Salm believes that Ethereum ETFs deserve similar regulatory approvals to Bitcoin ETFs.
Salm remains optimistic about the final decision, expected by the end of May 2024. He acknowledges the possibility of changing sentiments as the decision date approaches but emphasizes that the current lack of regulator involvement does not necessarily imply a negative outcome. His views align with industry leaders such as Coinbase’s Chief Regulatory Officer, Paul Grewal, and former Commodity Futures Trading Commission (CFTC) Commissioner Brian Quintenz.
Grewal and Quintenz argue for the adoption of Ethereum ETFs, citing compatibility with Ethereum futures ETFs, classification of Ethereum futures as commodity futures rather than security futures, and the high correlation between futures and spot prices. Salm also highlights the importance of investors gaining access to Ethereum through spot ETFs, similar to Bitcoin ETFs. He expresses Grayscale’s commitment to engaging with regulators on this issue and emphasizes the company’s confidence in the strength of the case for Ethereum ETFs.