Author: Jesse Hamilton; Translated by Baishui, Golden Finance
Summary
Gary Gensler, chairman of the U.S. Securities and Exchange Commission, said that the Ethereum ETF has actually been approved and all that remains is to finalize the registration details at the staff level.
Gensler reiterated his complaints about the unregulated cryptocurrency industry, refusing to answer whether ETH is a commodity and arguing that the CFTC is not ready to regulate the cryptocurrency market.
Commodity Futures Trading Commission Chairman Rostin Behnam also spoke about the agency’s efforts to ban prediction market election contracts.
SEC Chairman Gary Gensler told senators at a budget hearing on Thursday that final approval for an Ethereum ETF should be completed this summer.
At a hearing to defend the market regulator’s budget, Gensler told a Senate Appropriations subcommittee that the process was “going well” after giving preliminary approval to a group of ETFs. The agency had previously approved an initial round of applications, but he said final registration requirements — so-called S-1 filings — were now being worked on at the “staff level.”
Once those filings are approved, new ETFs can come to market, opening up a wider market for easily traded funds that hold actual Ethereum, much like earlier established spot ETFs that hold Bitcoin. The SEC initially blocked applications for Bitcoin ETFs until a federal court ruled that the agency had mishandled them, a decision Gensler said the SEC has since followed through on and allowed them.
When asked directly if ETH is a commodity, Gensler did not answer yes or no, instead maintaining his agency’s indecisive stance on the asset. During the same hearing, when asked if it was a commodity, Commodity Futures Trading Commission (CFTC) Chairman Rothstein Benham responded, “Yes.”
The question is important when trying to figure out which agency is best suited to regulate various tokens in the U.S. The SEC will oversee security tokens, while the CFTC will have regulatory authority over the rest. While Gensler has repeatedly said the vast majority of digital assets should be considered securities, he has declined to specify which assets fit into which basket beyond those his agency has listed in enforcement actions.
“While not all cryptocurrencies are crypto-securities — some fall under Chairman Behnam’s jurisdiction — those that are crypto-securities have an obligation to disclose them to the public,” Gensler said, reiterating his view that most tokens remain unregistered and in violation of securities laws.
Gensler, who has served as chairman of both agencies, said the industry is “flouting” the rules. He also said the CFTC is not currently well-prepared to oversee a disclosure-based supervisory system because, unlike the SEC, it does not do it.
Behnam noted that if the CFTC were to take on more responsibility for regulating cryptocurrency trading, something legislative efforts in Congress would surely require, it would still lack some of the necessary powers to regulate the cryptocurrency markets.
“We don’t have those traditional regulatory tools — registration, custody, monitoring, oversight — that are really what makes the U.S. capital markets and derivatives markets so strong,” he said, adding that the CFTC needs a bigger budget to make that happen.
Behnam was also asked about popular prediction markets from companies like PredictIt, Polymarket, Zeitgeist and Kalshi, and his agency’s stance against contracts that predict election outcomes. His agency recently took action to block such contracts.
“The last thing we need right now is the commodification of elections," Behnam said. "That, in my opinion, is a clear violation of existing laws, and we are taking steps to make sure they are prohibited.”
