The SEC Delays Decision on Fidelity’s Ethereum ETF Application
The U.S. Securities and Exchange Commission (SEC) has announced a delay in its decision on Fidelity’s application to launch spot Ethereum (ETH) ETFs. The regulator now expects to make a decision on March 5, 2024, as stated on their website.
According to the SEC filing, the longer period for consideration is necessary to thoroughly review the proposed rule change and the raised concerns.
SEC filing
Bloomberg analyst James Seyffart predicted this delay and believes that the SEC will further postpone the decision until May. As a result of this news, the price of Ethereum experienced a slight decrease of 2.8%, currently trading at $2,459. However, cryptocurrency trading volumes have significantly increased by over 14% within 24 hours, reaching $11.9 billion.
Will an Ethereum Spot ETF Follow Bitcoin’s Approval?
Last week, the SEC approved 11 spot Bitcoin (BTC) ETFs for trading, leading industry participants to speculate if an Ethereum spot ETF will soon follow suit. Fidelity and BlackRock entered the race for an Ethereum spot ETF in late 2023. Prior to their applications, ETH futures ETFs were introduced. BlackRock’s CEO, Larry Fink, expressed his belief in the value of a spot ETF based on Ethereum and sees it as a step towards tokenization.
Hot Take: The Future of Ethereum Spot ETFs
The SEC’s decision to delay Fidelity’s application for an Ethereum spot ETF raises questions about the regulatory environment surrounding these investment products. While Bitcoin spot ETFs have gained approval, it remains uncertain when or if an Ethereum spot ETF will receive the green light. Nevertheless, the growing trading volumes and increasing interest in cryptocurrency ETFs indicate a strong demand from investors. As the industry continues to evolve, it will be crucial for regulators to carefully consider the potential benefits and risks of these innovative investment vehicles.
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