Feeling bullish about a spot Ethereum ETF? Think again. According to issuers of spot Bitcoin ETFs, the U.S. Securities and Exchange Commission (SEC) is unlikely to approve a spot Ethereum exchange-traded fund (ETF) anytime soon.

Ethereum, the second-largest cryptocurrency globally, has been the subject of speculation for a spot ETF approval ever since SEC Chair Gary Gensler gave the green light to 11 spot Bitcoin ETFs applications in January.

Companies like BlackRock, Fidelity, and VanEck, which issued spot Bitcoin ETFs, have been waiting in the wings for an Ethereum product, but now it seems that some are just testing the waters and are not entirely sure of a positive outcome.

Speaking at the Paris Blockchain Week crypto event this week, VanEck CEO Jan van Eck shared his pessimism about the chances of an Ethereum ETF approval.

"We were the first to file as well for Ethereum in the U.S., and we and [Ark Invest CEO] Cathy Wood, are kind of the first in line for May, I guess, to probably be rejected," he told CNBC's Arjun Kharpal.

The SEC has until late May to conclude its review of VanEck's Ethereum ETF, with other applications waiting in line all the way up to October.

Unlike Bitcoin, which has long been considered to be a decentralized commodity, the official regulatory position regarding whether Ethereum is a security is not as clear. That’s made things harder for ETH investors.

"I don't want to prejudge any one filing, '' Gensler told Yahoo Finance in March. He has been cautious not to give any concrete statement on the subject. But the CFTC has actually said at different times that it considers Ethereum to be a commodity—which could potentially speed up the approval process should the SEC acknowledge its definition.

CoinShares CEO Jean-Marie Mognetti, also speaking to CNBC, shared his skepticism about gaining SEC approval for a proof-of-stake coin like Ethereum. "I don’t see anything being approved this side of the year," he noted.

In a proof-of-stake consensus model, blocks are confirmed not by miners but by stakers—people holding large amounts of the native token (in this case, ETH) that they lock in the network. This fact—which now is key for the operation of the Ethereum blockchain—resembles the nature of a security in which large shareholders decide how a business works and get rewarded for their investments.

The approval of an Ethereum ETF would increase exposure to the cryptocurrency, allowing new investors to indirectly buy the coin and trade it. That also means potential Ethereum ETF issuers would need to have enough ETH in custody to cover a 1:1 trading volume—which enthusiasts consider to be bullish as it can make on-chain ETH scarcer.

While there are already some Ethereum futures ETFs approved, it does not guarantee that a spot ETF will receive the green light. There was a two-year gap between the first Bitcoin futures ETF and the first Bitcoin spot ETF approvals.

The first Ethereum futures ETFs were approved in 2023, so there may be a long road ahead before the first spot ETH ETF is launched— that is, of course, if history repeats itself.

Edited by Andrew Hayward