US SEC Delays Decision on Multiple Ethereum ETFs, What’s Next?

The United States Securities and Exchange Commission (SEC) has announced a delay in its decision on several Ethereum (ETH) exchange-traded funds (ETFs) until May 2024. As per regulatory filings on December 18, the SEC postponed its decision on the Hashdex Nasdaq Ethereum ETF and the Grayscale Ethereum Futures ETF.

The Hashdex Ether ETF shall hold both spot Ether and futures contracts. Similarly, Grayscale’s Ethereum Futures ETF is a strategic move to potentially facilitate the conversion of Grayscale’s Ethereum Trust into a spot Ethereum ETF, often referred to as a “trojan horse”.

In these filings, the SEC stated that it is initiating proceedings to gather additional public input on whether these ETFs should be listed. The regulatory agency also extended its decision timeline for the VanEck spot Ethereum ETF and the spot Ethereum ETF proposed by Cathie Wood’s ARK Invest and 21Shares.

Bloomberg ETF analyst James Seyffart confirmed the anticipated delays in the decision on Ether (ETH) exchange-traded funds (ETFs). These delays were likely to occur before December 25. Seyffart noted that the SEC’s final deadline for deciding on these ETFs will fall in late May. It’s noteworthy that, despite having approved Ethereum futures ETFs previously, the SEC has not yet granted approval for a spot or mixed-type product.

Focus on Spot Bitcoin ETFs

The market’s attention is currently fixated on the SEC’s potential approval of 13 spot Bitcoin (BTC) ETFs. Analysts, including James Seyffart and Eric Balchunas from Bloomberg, suggest that the SEC may reach a decision as early as January 10, with a favorable outlook of around 90% for spot Bitcoin ETF approval.

The prospect of institutional access to Bitcoin has fueled optimism in the markets, contributing to Bitcoin’s impressive 44% growth in the last six months. Meanwhile, Ether has experienced a more modest gain of 16.8% during the same period, according to TradingView data.

In the latest, ARK Invest and 21Shares have collaboratively filed an S-1 amendment with the US SEC for their spot Bitcoin ETF, incorporating the SEC’s “cash create” redemption mechanism for the proposed product. This strategic move is considered positive for the progress of BlackRock’s spot Bitcoin ETF, marking a noteworthy development in the dynamic landscape of cryptocurrency exchange-traded products. In alignment with this trend, WisdomTree has also updated its Bitcoin ETF application by submitting an S-1 amendment.

Bitcoin and the broader cryptocurrency market are witnessing substantial volatility, with the BTC price surging by 5.5%, surpassing the $43,000 level. Within the last 24 hours, Bitcoin has contributed over $50 billion to its market capitalization.

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