SEC defers decision on several ETH ETFs to May 2024

The United States Securities and Exchange Commission (SEC) has postponed its decision on several Ethereum-based exchange-traded funds (ETFs) until May 2024.

This announcement came through regulatory filings made on Dec. 18. Among the delayed decisions are those concerning the Hashdex Nasdaq Ethereum ETF, the Grayscale Ethereum Futures ETF, the VanEck spot Ethereum ETF, and a spot Ethereum ETF proposed by Cathie Wood’s ARK Invest and 21Shares.

The Hashdex Ether ETF is unique in its approach, aiming to incorporate both spot Ether and futures contracts. Meanwhile, Grayscale’s Ethereum Futures ETF is perceived as a strategic move to eventually convert its Ethereum Trust into a spot Ethereum ETF, a view that has gained significant attention within the industry.

The SEC has declared that it will initiate proceedings to gather more public input regarding the potential listing of these ETFs, a move that underscores the agency’s commitment to thorough scrutiny and public engagement before making a final decision.

James Seyffart, a Bloomberg ETF analyst, indicated that these delays were anticipated, with final decisions from the regulator expected by late May.

Seyffart’s insights align with the broader market expectations, as the community has been closely following the SEC’s stance on cryptocurrency-based ETFs.

Previously, the SEC has approved ether futures-based ETFs but has stopped short of greenlighting spot ether or mixed fund ETFs. Notably, in October, nine futures-based products received approval simultaneously, marking a significant development in the industry.

The ongoing debate and anticipation in the crypto sector extend beyond Ethereum ETFs. The market is closely observing the SEC’s decisions regarding 13 spot Bitcoin (BTC) ETFs currently under review.

Bloomberg analysts Seyffart and Eric Balchunas suggest that a decision on these Bitcoin ETFs could come as early as Jan. 10, 2024.

Both analysts have estimated a 90% likelihood of the approval of a spot Bitcoin ETF. This high probability has injected optimism into the market, particularly regarding institutional access to Bitcoin.

Over the last six months, Bitcoin has seen a price increase of over 44%, while Ether (ETH) has also experienced a notable rise of 16.8% in the same period, as per data by CoinMarketCap.

Investors and industry experts have expressed concerns that delays in approving Ethereum ETFs are hindering market development and limiting investors’ access to diversified investment opportunities.

However, the SEC maintains its stance on thorough evaluation to prevent fraudulent activities and protect investor interests.

As the crypto community awaits the SEC’s final decisions, the agency encourages public participation in commenting on the proposed rule changes for Ethereum ETFs. This involvement is seen as a vital part of the regulatory process, shaping the future landscape of cryptocurrency investments in the US market.