While the rapid approval of Ethereum ETFs this week surprised some observers, TD Cowen's research team viewed this development as inevitable after Bitcoin ETFs were approved earlier this year.

Jaret Seiberg from TD Cowen's Washington Research Group noted in a Thursday statement that the approval arrived about six months sooner than anticipated. However, Seiberg mentioned that this decision was expected following the SEC's approval of crypto futures ETFs. He also speculated that within a year, there might be an offering featuring a "basket of crypto tokens," potentially including Bitcoin and ether, among others.

Nevertheless, this approval doesn't signal a broader shift in the SEC's stance on crypto. Gary Gensler, the Commission's crypto-critical chair, issued a "highly critical" statement regarding the passage of crypto legislation that might reduce the agency's authority. Gensler emphasized that the crypto industry's challenges stem from players not adhering to existing rules, rather than a lack of regulations.

Despite potential challenges for Gensler's agency, TD Cowen forecasts that the SEC will maintain its Democratic majority through 2026. The research team expects ongoing litigation against crypto trading platforms dealing in tokens deemed unregistered securities by the agency.