- SEC delays ruling on Ethereum ETF proposals from Invesco, Galaxy Digital, Fidelity, and BlackRock, signaling cautious regulatory approach.
- Market analysts optimistic about SEC approval for spot Ethereum ETFs, estimating a 60% likelihood despite ongoing delays.
The decision by the United States Securities and Exchange Commission (SEC) to delay its ruling on the proposal for a spot Ethereum ETF, submitted by Invesco and Galaxy Digital, marks another chapter in the regulator’s cautious approach to cryptocurrency-based financial products. This delay, as reported by James Seyffart, a senior Bloomberg analyst specializing in ETFs, was expected, considering the SEC’s usual stance on such requests.
🚀📅 SEC's Delay Game Continues! 🕒🚫@InvescoUS & @galaxyhq's #Ethereum ETF faces another delay, but it's no surprise! 📉
📆 Circle May 23rd on your calendar, that's the day @vaneck_us's spot #ETF could make history! 🗓️💥 #CryptoNews #CryptoETFs pic.twitter.com/NCskX28xow
— Marcel Knobloch aka Collin Brown (@CollinBrownXRP) February 6, 2024
The SEC exercises its discretion, grounded in Section 19(b)(2) of the Securities Exchange Act, to extend the 45-day period for public comment reception to a maximum of 90 days, if deemed necessary for thorough analysis. This practice of postponement is not exclusive to the proposal by Invesco and Galaxy Digital; other applications, such as Fidelity Investments’ for a spot Ethereum ETF, have also experienced delays.
Approximately two weeks ago, the SEC decided to postpone its verdict on Fidelity’s proposal, extending the review period for the proposed rule change by another 45 days. This shifted the original deadline of January 20, 2024, for the rule change related to Fidelity’s Fund to March 5, 2024.
Furthermore, BlackRock faced a similar situation with its spot Ethereum ETF application, being postponed until March 10, 2024. The reason behind this delay was the lack of public feedback, highlighting the need for more time for proper consideration.
The ongoing postponements in decisions regarding spot Ethereum ETF proposals from Fidelity and BlackRock suggest that further delays could be announced. However, May 23, 2024, emerges as the definitive date for the SEC to issue a ruling on VanEck’s spot Ethereum ETF proposal.
Market expectations are high, with analysts and specialists generally positive about the possibility of spot Ethereum ETFs eventually receiving approval from the SEC. There is an estimated 60% chance that these financial products will be endorsed by the regulator, despite differences of opinion among experts.
This scenario underscores the SEC’s caution in dealing with proposals for financial products incorporating cryptocurrencies, seeking to balance market enthusiasm with the need for thorough analysis. The anticipation for the approval of spot Ethereum ETFs reflects the growing interest in investment vehicles that offer a regulated and accessible way to participate in the crypto asset market, which could open up new opportunities for both institutional and retail investors.
This period of evaluation and reflection by the SEC highlights its commitment to investor protection and market integrity, ensuring that any new financial product meets established regulatory standards. The final decision on these ETFs will be a key indicator of the future direction of cryptocurrency regulation in the United States and its impact on how investors access these new asset classes.
