According to a report by Cointelegraph, Bloomberg ETF analyst James Seyffart stated that the U.S. Securities and Exchange Commission (SEC) implicitly classified Ethereum (ETH) as a commodity when approving Ethereum futures ETF last year, indicating that spot-based ETFs could be launched this year.
During a CryptoQuant private webinar on January 4th, Seyffart mentioned the approval of Ethereum futures ETF in October 2023 and noted that the SEC did not challenge the classification of ETH in the ETF registration process with the Commodity Futures Trading Commission (CFTC). He said:
Seyffart suggested that the SEC may not have invested enough time or willingness to challenge this classification. According to Seyffart, if the SEC deems ETH as a security, it may face legal challenges and be required to revoke previously approved futures ETFs.
The classification of ETH is reported to be crucial as securities and commodity ETFs are subject to different legal requirements, as well as different tax and regulatory burdens related to securities. Seyffart pointed out: