ETH ETF Officially Approved! | James Seyffart

Bankless Nation,

it happened.

The Ethereum ETF has been officially approved. Last week, all the best ETF analysts told us ETF approval was just not happening. But then, today, it happened. We got a complete 180 pivot from the SEC. So David and I were on a live stream. We were just like waiting and watching for this to happen. It was like watching paint dry. And we were about to leave the live stream. David had to go do something when we got this confirmation tweet from Bloomberg analyst James Seifert.

I wanna play a clip of what that felt like. Snor

We gotta go do things. I'm sorry we have to go. I

You guys uh man the screens for us, okay? And let us know. Um I'll be checking my phone.

Don't

don't don't do James James Safert. James Safert Twitter. James Safert Twitter.

we were about to log off.

I can't I can't deal with another false alarm, David.

It's approved.

Shut up!

What?

SHUP! Let's go! Let's fucking go! Let's fucking go!

James, get him on! Get him on!

Oh, get him on the podcast. So we did get James on the podcast shortly after that. That's actually the episode you are about to hear. And uh I'm sure you heard the excitement in our voices. And here's why we were excited. Number one, this clarifies Ethereum's status in the US. It's never had this before, but Ethereum can no longer be called a security in any courtroom, in any institution, anywhere. Ether the asset is a commodity in the US. And that is big. Number two, this creates a massive new pipeline of capital to flow from TradFi to Ethereum. That's big in and of itself. And number three, and I think in some ways this was the biggest this is regulatory relief to a crypto industry that has been under relentless assault from the US government and in particular from the SEC.

And here's the biggest thing. I think probably the most exciting thing about this news, and you heard it in our voices.

We helped to make this happen.

And by we, I mean us. I mean you. I mean the bankless nation. I mean the crypto community.

Our voice, our votes,

our actions actually put political pressure on the SEC chair, Gary Gensler, to last minute approve an ETF that he wanted nothing more than to deny. The battle's not over for crypto. We've got many fights ahead. But let's enjoy this victory for a moment. We've got Bloomberg analyst James Seifert coming right up. He tells us how this story happened, how the Ethereum ETF approval unfolded, what to expect next. So we talk price, we talk inflows, we talk who are the issuers, we talk a future staked ETH ETF, when we can expect to see that, and also what the next crypto ETF might look like. So let's get right into the episode with James. But before we do, we want to thank the sponsors that made this possible.

Bankless Nation, we've got a breaking live stream. We've got uh James Seifert over here. He is an analyst at Bloomberg. He is an ETF expert and we just got some incredible news, um exciting news I think for the crypto community, James. What just happened?

Yeah, I mean the SEC came out and just accelerated and approved um every ETH filing that got in their nineteen before. So this is a nineteen before order. And what that really is,

it's a rule change proposal. Basically, all these exchanges, they had to do this with the Bitcoin ETFs too. You have to basically submit these filings and ask the SEC to change a rule. In this case, the rule is we want to trade Ethereum ETFs. In the case of Bitcoin, it was we want to trade Bitcoin ETFs. And the SEC has to go through and basically say this is allowed. So this is the first step. There's two two main steps before these things can be beginning trading. And this is number one.

So this is the number one. It's also the big one, right? Because it's the thing that has been the uh um SEC has been reluctant to say. So that's the 19B. I think we've got some of the issuers on the screen, but I think there's maybe more. Um you mentioned, did you say 17, 19, something like this? You've got a number of them on the screen.

No, no, no. That's all of them plus the Grayscale Mini, but actually hash decks didn't didn't um submit a 19 before.

Um so they're not actually going to launch one. It doesn't look like

Okay, so are there more issuers, fewer issuers, or is this pretty much similar to the issuers for the Bitcoin ETF?

there are less issuers here. Um and especially if you take into account, so right, you you if you include grayscale. So grayscale, everyone's been talking about that Bitcoin mini trust. I'm not sure if you guys are familiar, but especially they're they're spinning out 10 or 15% of GBTC into the smaller ETF.

It's called the Grayscale Mini Bitcoin Trust.

Exactly. We don't know exactly the fee. I think people are saying it's going to be 15 basis points, but it's going to be the lowest fee.

They're doing the same thing with ETH, and they filed that in here.

So that's also going to launch at some point in the near future.

But essentially, Grayscale is going to launch two of these things. I don't know if the ETH Mini Trust is going to be included. I haven't had a chance to really dive deep into this filing since it just dropped, but I've skimmed through it. There's a lot here to go through. There's 23 pages. So as soon as we get off of this, I'm going to basically have to dive into that.

Okay, so when you say boom approved, you're talking about all of those filings uh were just approved all at once. I I think this is um this is pretty crazy because of the setup here, which is it was like Friday of last week. It looked like none of this stuff was going to be approved, right? Like you didn't see any movement on your side as you're going through the paperwork and stuff. Here's a tweet from uh Friday, which is it's just not happening, guys. Sorry. And I think you tweeted that, James, because like it didn't look like it was happening. I I guess the the the broadest of questions here.

Did the SEC just do like a 180 on this? Or like, what is going on? How did we get from here? It's not happening. There's no signs of movement. To Monday, suddenly, it was I think either you or Eric Eric Balciounas had tweeted this out where

Yeah, your your probability of approval just shot up to 75% on Monday when like on Friday it was like near near zero.

Yeah, so early afternoon we started here rumblings and we were like, this can't be true, can it? Like, can this actually be happening? And like we were scrambling. So we know people that are like

somewhat in the process. Some people are like outside, but kind of know what's going on. We have a lot of people we talk to in the space. Obviously, there's a lot of signs and tea leaves we read, but we also have sources that we're talking to to try to make sure we're getting this stuff right. And we had one or two people tell us, yeah, something's happening. And then we got more and more people be like, Yeah, this is insane. I can't believe this is happening.

Um and that was Monday afternoon, and that's when so Eric and I actually were on the phone for like 30 minutes going over like fine tooth comb about exactly what we wanted to tweet because we knew it was gonna be market moving. We actually offered it to Bloomberg News and

and they didn't want to put it out there yet. So

Because they

it seemed so tenuous, it seems so

I didn't see exactly

last minute.

but we trusted our sources. Um and obviously we were we were very

we didn't think it was gonna happen. As you see, I tweeted that on Friday. Life comes at you fast. What explains this?

It's the political wins. It has to be. Like people are trying to say this was always the case. Like, that is not what happened here. This is a complete shift. Um, from what I understand,

specifically, the division that approves those 19B4s is they're called the division of trading and markets. They're

they're mainly worried about fair, efficient, orderly markets. Like that's what their whole thing is. And with these 19B4s, they want to make sure there's no fraud, manipulation, things like that. So these ETFs, these products can't like help other people commit fraud and manipulation or get stuck with other people doing fraud and manipulation. That's what most of this is about.

Um, that division from what we're here didn't like know about this until late last week. Like they were under the assumption they were denying. So like it's not like the SEC knew this was going to happen all the time. We've I've I've based on everyone I'm talking to, this is a complete political shift. And if you just look at everything else that has happened here, like you look at some of the polling for the elections, you look at the SAB 121 votes in the House and then the Senate, and then you look at what happened today with the FIT 21 Act, which is a market structure bill for crypto.

Um

Trump saying he's pro crypto here and

yeah. Like there's so many things that point to like the the Dems basically decided like we can't go this way. So

I'll be interested to see. Um at some point we'll get there was probably a vote on this.

Um so

Because the last last vote was like um three to two, right? And Gensler was the kind of the breaking tie vote. Because the what is it? The the commissioners have to vote, each of the SEC uh commissioners have to have to vote. And uh two voted no for the Bitcoin ETF, three voted yes, and the third was uh Gary Gensler. So did this break a similar way, or do you know yet?

correct.

We don't we don't know. We don't know. At some point we'll find out. I don't know exact timelines of that. It's not on the site now from I just checked, like literally three seconds ago. But um essentially you the commission is a five-member commission, two Dems, two Republicans, and then usually whoever the president is at the time gets to pick the commissioner, which is usually a tie break. So the commissioner gets to decide where things go. Um but it's not impossible to have people break. Um so it'll be very interesting to see how this goes down.

Um so Lizaraga in Crenshaw, the two Dems other than Gensler. And if one of them, which I there's no way it was Crenshaw, but she wrote a dissent letter, she might have she she voted no on that, and then she wrote a dissent letter.