June 26 (Reuters) - The U.S. Securities and Exchange

Commission could approve exchange traded funds (ETFs) tied to

the spot price of ether as soon as July 4, as talks between

asset managers and regulators enter the final stages, industry

executives and other participants told Reuters.

Eight asset managers, including BlackRock ( BLK ), VanEck,

Franklin Templeton and Grayscale Investments, are

seeking SEC approval for the funds. Most of them had rolled out

spot bitcoin ETFs in January, the culmination of a decade-long

tussle with regulators. Grayscale again hopes to convert an

existing trust into an ETF.

Executives at two firms, who requested anonymity due to the

confidential nature of the discussions, said the process of

amending the offering documents has progressed to resolving only

"minor" issues. Those documents must be approved before the ETFs

can be launched.

A lawyer working with one of the issuers, who also requested

anonymity, said it was "down to the finishing touches" and that

approval is "probably not more than a week or two away."

The SEC declined to comment. In an interview with Reuters

earlier this month, SEC Chair Gary Gensler said the launch date

depends partly on how quickly issuers respond to the regulator's

queries.

The January launch of funds tracking the spot price of

bitcoin was one of the most successful in the ETF market,

drawing some $8 billion in assets, Morningstar Direct data

showed. As of late June, those nine new products have nearly $38

billion in assets, although the holdings of Grayscale Bitcoin

Trust - which converted its $27 billion bitcoin trust into an

ETF at the same time - dipped to $17.8 billion.

Many ETF and cryptocurrency analysts believe the launch of

the new spot ether ETFs will be less impressive.

"Ethereum is not the same size in terms of market cap, nor

does it have the same volumes," said James Butterfill, head of

research at Coinshares.

The price of ether has languished this month, falling

more than 11%, alongside a 9.8% drop in bitcoin. Moves in

bitcoin typically impact the price of ether.

Given the differences in market size and nature of the two

cryptocurrencies, inflows may be much more muted when the ether

ETFs launch, said Bryan Armour, an ETF analyst at Morningstar.

"With bitcoin, there had been pent-up demand for a decade

and investor interest was off the charts," he said. "This just

isn't going to command the same excitement."

The SEC has already approved the rule changes required for

the New York Stock Exchange, Nasdaq and Cboe to list and oversee

trading in the new products. That means that once SEC staff sign

off on the filings, the products could start trading in as

little as 24 hours.