ETH Futures ETF Sponsor Argues CME Surveillance Good Enough for Spot ETPs Approval
In a recent filing, the sponsor of an Ether (ETH) futures exchange-traded fund (ETF) asserted that the approval of ETH futures ETFs implies that the Commodity Futures Trading Commission (CFTC) deems the Chicago Mercantile Exchange (CME) surveillance capable of detecting spot-market fraud that affects spot exchange-traded products (ETPs).
“Either CME surveillance can detect spot-market fraud that affects both futures ETFs and spot exchange-traded products, or that surveillance cannot do so for either type of product,” the filing said. Having approved ETH futures ETFs in part on the basis of such surveillance, the Commission has clearly determined that CME surveillance can detect spot-market fraud that would affect spot ETPs, and the Sponsor thus believes that it must also approve spot ETH ETPs on that basis.
This statement raises questions about the CFTC’s approval process for ETH futures ETFs and its implications for spot ETH ETPs. The sponsor’s argument hinges on the belief that if the CME’s surveillance is good enough for futures ETFs, it should also be sufficient for spot ETPs. This has significant implications for the SEC’s decision-making process regarding spot ETH ETPs.
This latest development in the ongoing debate over ETH-based investment products highlights the need for clarity and consistency in regulatory decision-making. The implications of the CFTC’s approval of ETH futures ETFs are far-reaching and merit careful consideration.
According to the filing, this issue revolves around the essential question of whether CME surveillance is capable of detecting spot-market fraud that would affect both futures ETFs and spot ETPs. The upcoming decisions by the CFTC and the SEC on spot ETH ETPs will provide insight into their approach to this critical issue.
This filing underscores the need for transparency and thorough evaluation of market surveillance capabilities as regulators consider the approval of new investment products. It adds further complexity to the ongoing discussions surrounding the regulation of ETH-based financial instruments.
The sponsor’s argument sheds light on the interconnectedness of various investment products in the cryptocurrency market and the regulatory challenges they pose. It is a reminder of the importance of robust surveillance mechanisms in safeguarding investors and maintaining market integrity.
The debate over the approval of spot ETH ETPs continues to unfold, with regulatory decisions looming on the horizon. As stakeholders await these decisions, the implications of the CME surveillance capabilities and the CFTC’s approach to spot-market fraud detection remain a focal point of discussion.
Overall, this filing has significant implications for the regulatory landscape of ETH-based investment products and underscores the need for careful consideration of market surveillance capabilities in the approval process. It highlights the interconnectedness of different investment products and the complexity of regulatory decision-making in the cryptocurrency market.
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