Will SEC be sued if Ethereum ETFs are rejected? Analysts weigh in

• Analysts are undecided on whether or not there will likely be litigation if there’s an ETH ETF rejection in Could. 
• However the odds of approval in Could stay very low throughout the board. 

Because the deadline attracts nearer, Ethereum [ETH] ETF approval odds in Could seem unlikely. Nonetheless, some have been fast to think about what would occur if the ETH ETFs confronted rejection in Could. 

May Grayscale, for instance, sue the SEC because it did again in 2022 when the regulator rejected its utility to transform GBTC to a spot Bitcoin [BTC] ETF? 

Bloomberg ETF analyst Eric Balchunas thinks Grayscale will possible not pursue litigation if ETH ETFs are rejected in Could. Citing the restricted market share of ETH ETF futures market in comparison with BTC’s, the analyst said,

“Lots of people assuming Grayscale (or somebody) will sue SEC after they reject the Ether spot ETFs. I’d query this as Ether futures solely ETFs have 4% of the belongings that Bitcoin futures have.”

The analyst added,

“That’s numerous money and time for one thing that will solely get a fraction of the aum.”

JPMorgan expects litigation in case of ETH ETF Could rejection

Balchunas’ place is contrarian to that of JPMorgan analysts. In an interview with The Block, JPMorgan maintained an optimistic view of an eventual approval for spot ETH ETFs. 

JPMorgan lead analyst Nikolaos Panigirtzoglou famous that,

“If there isn’t a spot Ethereum ETF approval in Could, then we assume there’s going to be a litigation course of after Could.”

Nonetheless, executives from potential issuers like VanEck and CoinShares have been pessimistic about Could’s approval. 

In a current CNBC interview, VanEck CEO, Jan van Eck, in contrast the spot BTC ETF approval course of to its ETH ETF submitting and said that “proper now, pins are dropping so far as Ethereum is worried.”

On his half, CoinShares CEO Jean-Marie Mognetti stated he didn’t count on an ETH ETF approval in any respect this 12 months.

Nonetheless, in late March, Grayscale CLO Graig Salm remained assured of Could’s approval and cautioned that the regulator’s lack of engagement shouldn’t be thought of to point a particular final result. 

Even so, it stays to be seen whether or not an individual or one of many potential issuers will pursue litigation if spot ETH ETF functions are rejected in Could.