In a sudden change of events over the last few days, the swathe of prospective Ethereum ETH +2.19% ETFs is now widely anticipated to have a good chance of being approved in the near term — potentially even today.

The events have unfolded very differently from the Bitcoin ETF approvals, with the rapid turnaround causing speculation that political intervention may have intervened at the last minute. Either way, it’s now a considerable possibility that these products might get approved shortly.

Here’s a summary of how we got to this point and how it could play out.

How did we get here?

There were weeks of positive signs leading up to the approval of the Bitcoin ETFs. The main point was that the U.S. Securities and Exchange Commission was engaging with issuers on their applications, sending feedback and resulting in new versions being submitted.

By the time of the approvals, it appeared a foregone conclusion that all the ETFs would be approved in one go — and this was indeed the case. The only couple of hitches were the SEC’s X account getting hacked to tweet a premature approval announcement and the way the approval document was found on the agency’s website before it was published in the right area. (Which led to the agency refusing to confirm its authenticity to press until a while later, causing even further confusion).

What was different this time around is that there was no engagement between the SEC and issuers until the 11th hour. This led analysts to largely predict that there was little chance of the products getting approved. 

However, on May 20, reports emerged that the SEC had suddenly started engaging with prospective issuers over their Ethereum ETF application — in a move that seemed both surprising to the issuers and to parts of the SEC itself. For instance, examiners within the SEC's division of corporation finance were seemingly not on the same page as the agency's division of trading and markets, The Block reported.

This lack of internal coordination prompted speculation that it was a last-minute political decision, although some pundits disagree over this. The timing seemed apt, though, as the next day, presidential candidate Donald Trump’s campaign started accepting cryptocurrency donations, showing his continued support for the sector — and adding support to the notion that crypto is becoming an increasing element in the quest for votes in the upcoming election.

Since May 20, the prospective issuers have updated their 19b-4 forms, with many of them now published to the SEC website. The feedback given to these forms was “relatively light,” meaning that they could get turned around quickly.

There are two parts to an ETF being approved. The SEC needs to approve the 19b-4 forms and the S-1 registration statements need to go effective. Now that the 19b-4 forms are in, the SEC has started engaging with issuers on the S-1 forms. This is another positive sign that the ETFs may be slated for approval — but nothing is definite.

What happens next?

Now that the 19b-4 forms are in, there are two main things to watch out for next. The first big step is whether the SEC approves the 19b-4 forms — either individually or all in one go. 

If the SEC approves just one 19b-4 form, it should show up on the SEC website here. Equally, if the SEC approves all of the 19b-4 forms in one omnibus order, then it should show up in the same place. For the Bitcoin ETFs, this order named all of the applicants and said that it approved the proposals on an accelerated basis.

Today matters because it’s the final day for the VanEck Ethereum ETF to be either approved or denied. This means if the SEC is not ready to approve the products, or if it has no intention of approving them, then the ETF will get denied and VanEck would need to reapply. 

If the SEC denies the VanEck ETF, such an order would be published in the same area on the SEC website, with the language stating that it’s disapproving the proposed rule change. However, while this would delay the process, the signs of engagement between the SEC and prospective issuers would still suggest a potential approval on the way — just not as quickly.

If the 19b-4 forms are approved, then the ETFs have largely been approved. However, the final step is for the S-1 registration statements to go effective before trading can begin. Unlike the 19b-4 forms, approval of these is not published online. Instead, the agency privately informs the issuers that they are good to go.

When the Bitcoin ETFs were approved, the S-1 forms became effective only a few hours later. This was reported on by the press citing sources ahead of public confirmations by the issuers shortly afterwards.

However, in this case, the S-1 forms might not be approved as quickly. This is because the SEC appears to be trying to process them at the last minute and they aren’t subject to the same deadline as the 19b-4 form process. Fox Business reporter Eleanor Terrett said on X that there’s “work to do” on the S-1 forms, citing sources, implying that these are not necessarily ready. 

“I think that if they work extremely hard it can be done within a couple weeks but there are plenty of examples of this process taking 3+ months historically,” added Bloomberg ETF analyst James Seyffart.

So even if the Ethereum ETFs are approved, for them to start trading might take a little longer.