Subject: File No. SR-NYSEArca-2016-176
From: Bruce Granger

May 16, 2017

An SEC determination of the ether Initial Coin Offering (ICO) should be made with respect to securities laws. Recently, a security lawyer who has crypto-currency regulatory compliance knowlege (Jason Seibert) and who reviewed the timeline of activities of ether, claimed that the ether ICO clearly constituted an unlicensed, unregistered sale of a security. If that is indeed determined to be true, obviously an ETF would be a grave mistake. As well, recently the price of ether has increased dramatically in a short period. If an ETF pushes the price even higher, it would be devastating to investors if there were later an adverse determination regarding securities violations. See the interview with Jason Seibert here:

It would be extremely beneficial for the SEC to thoroughly review the securities issue claims. If ether can be given a "no action" status, then the next set of issues would relate to hard forks, one of which ether has had already. It's not clear how to communicate to the investor, all circumstances for which future hard forks will occur, and what the ETF will do in each case. The last hard fork was extremely contentious. I don't believe we are far enough in the crypto currency evolution to fully understand or properly disclose the mechanics or risks of forks to investors.