In a recent development, Van Buren Capital General Partner Scott Johnsson has brought attention to an overlooked detail in a March filing, reigniting discussions surrounding the U.S. Securities and Exchange Commission's (SEC) stance on ether (ETH) as a potential security. This revelation comes amidst expectations of forthcoming denials for spot exchange-traded funds (ETFs) this month.

Johnsson's discovery underscores the possibility that the SEC may consider ether a security, particularly in the context of upcoming spot ETF applications. Notably, this consideration has not been previously raised regarding spot/futures Bitcoin (BTC) ETF products.

The focus centers on a question posed in a filing related to BlackRock's spot ether ETF application, questioning whether the proposal aligns with Nasdaq Rule 5711(d) for Commodity-Based Trust Shares. This scrutiny highlights the SEC's evaluation of whether ETH should be categorized as a security, potentially impacting the approval of ETF listings.

Eric Balchunas, a Bloomberg ETF analyst, suggests that the SEC's inquiry into ether spot ETFs indicates a possible stance on ETH as a security in anticipated denials. Despite this revelation, analysts remain cautious about the likelihood of approval, maintaining slim odds.

James Seyffart, another Bloomberg ETF analyst, concurs with the assessment, suggesting that the SEC's consideration of ether as a security raises the probability of ETF denials. However, definitive conclusions await the SEC's forthcoming decisions.

Nate Geraci, President of The ETF Store, expresses uncertainty about the SEC's stance, questioning inconsistencies regarding the approval of ether futures ETFs. The potential classification of ether as a security could spark interagency conflicts and present significant implications, particularly in a U.S. election year.

The SEC faces imminent deadlines on May 23 and May 24 to adjudicate on spot ether ETF applications submitted by VanEck and ArkInvest/21 Shares, respectively. This latest development adds a layer of complexity to the decision-making process, potentially influencing the regulatory landscape for cryptocurrency ETFs.

Recent allegations by MetaMask developer Consensys further fuel speculation, suggesting that the SEC may have considered ether a security over a year ago, as indicated by a Wells notice received by the firm.

As the regulatory saga unfolds, market participants await the SEC's decisions with heightened anticipation, mindful of the potential implications for ether and the broader cryptocurrency ecosystem.