The decision on spot Ether exchange-traded funds (ETFs) could hinge on a single vote from Gary Gensler, chair of the United States Securities and Exchange Commission (SEC), if previous patterns hold.

In January, the approval of spot Bitcoin ETFs was determined by a five-commissioner panel.

Crypto-friendly commissioners Hester Peirce and Mark Uyeda supported the ETFs, while Commissioners Caroline Crenshaw and Jaime Lizárraga opposed them.

Gensler's affirmative vote was pivotal, leading to a 3-2 approval on January 10, 2024.

This week, the same five SEC Commissioners will decide on VanEck’s spot Ether ETF on May 23. Here’s a brief overview of their perspectives:

Hester Peirce has earned the nickname “Crypto Mom” for her supportive stance on digital assets and her advocacy for integrating more decentralization into the financial system.

She has not disclosed her vote on the upcoming Ether ETFs but has actively engaged with the Ethereum community, speaking at events like ETHDenver.

Peirce has criticized some of the SEC’s regulatory approaches as "unproductive" and "pointless."

Caroline Crenshaw has been a vocal critic of the cryptocurrency industry and opposed the spot Bitcoin ETFs, citing concerns over market manipulation and the lack of protection for U.S. investors.

She stated, “There is little to no systemic oversight of these markets, nor other sufficient mechanisms in place for the detection and deterrence of fraud and manipulation,” and added, “[Spot trading] is fragmented and scattered across different international trading venues, with many markets not subject to meaningful regulation.”

Mark Uyeda, alongside Peirce, has criticized the SEC’s “regulation by enforcement” approach.

Despite his reservations about how the SEC reached its decision, he supported the spot Bitcoin ETFs for “independent reasons,” though these reasons are not clearly defined.

Jaime Lizárraga opposed the spot Bitcoin ETFs without issuing a statement.

He has previously expressed skepticism about Bitcoin's role in financial inclusivity and believes many cryptocurrencies are operating outside U.S. securities laws.

Gary Gensler voted in favor of the Bitcoin ETFs, potentially influenced by Grayscale’s successful appeal against the SEC.

His current stance on Ether ETFs remains uncertain as he avoided confirming Ether’s status as a security in a recent Congressional inquiry.

Further complicating matters, SEC’s Division of Enforcement director Gurbir Grewal is leading an investigation into Ether’s status as a potential security, and some fund managers anticipate possible SEC rejections of Ether ETFs this week.

Bloomberg ETF analysts Eric Balchunas and James Seyffart now see only a 25% chance of approval for at least one spot Ether ETF on May 23, a steep decline from 70% since January.

Sources:

https://cointelegraph.com/news/spot-ether-etfs-decision-sec-commissioner-vote-gary-gensler

https://www.youtube.com/watch?v=9gbwrn3PR5U

https://www.sec.gov/news/statement/crenshaw-statement-spot-bitcoin-011023

https://www.mayerbrown.com/en/insights/publications/2022/12/newly-appointed-sec-commissioner-lizarraga-delivers-first-public-remarks-on-digital-assets

https://www.youtube.com/watch?v=5Z7GDtLYh1Y

https://twitter.com/JSeyff/status/1770183994635698474

https://www.bloomberg.com/news/articles/2024-05-17/fund-managers-brace-for-sec-rejection-of-ether-etf-applications?srnd=homepage-africa

https://x.com/NateGeraci/status/1792330334169903568