The United States Securities and Exchange Commission (SEC) has once again extended the deadline for Grayscale’s Ethereum Futures Trust exchange-traded fund (ETF). The SEC initially published the proposal for comment in October 2023 and is extending the deadline to have enough time to consider the proposed rule change.
Deadline Extension for Grayscale’s Ethereum Futures ETF
According to a filing on March 22, the SEC announced that it will prolong the decision-making process for Grayscale’s Ethereum Futures ETF. The commission has moved the deadline from March 31 to May 30 to make a decision on whether or not to approve the investment product.
The SEC stated in its filing that it needs a longer period to consider the proposed rule change and the issues raised. Therefore, May 30, 2024, is designated as the date by which the SEC will either approve or disapprove the proposed rule change.
James Seyffart, a Bloomberg ETF analyst, was not surprised by this deadline extension. He mentioned in a post on the X platform that there was a delay order for Grayscale’s Ethereum Futures ETF filing, as expected. In November, Seyffart expressed his belief that Grayscale’s application for an Ether Futures ETF is a way to gain approval for its spot ETH exchange-traded product. It remains to be seen how this delay will affect the clearance of the spot ETH ETF.
Unlikely Approval of ETH Spot ETF: Alex Thorn
Alex Thorn, Galaxy Digital’s head of research, believes that approval for Ethereum spot ETFs is currently unlikely. He bases this reasoning on the SEC’s subpoenas of crypto firms and lack of engagement with potential ETF issuers. The SEC sent subpoenas to various crypto companies regarding their relationships with the Ethereum Foundation. Thorn suggests that the SEC may be investigating whether the original Ethereum ICO was an unregistered securities offering.
Thorn also points out that the lack of communication from the SEC with applicants further reduces the chances of ETF approval. Considering these factors, the authorization of the ETFs in May seems highly unlikely.
Hot Take: SEC Extends Deadline for Grayscale’s Ethereum Futures ETF
The SEC has extended the deadline for Grayscale’s Ethereum Futures Trust exchange-traded fund (ETF) once again. The decision-making process has been moved from March 31 to May 30 to allow the SEC enough time to consider the proposed rule change. This extension does not come as a surprise to industry experts who have been closely following the developments.
The approval of Ethereum spot ETFs also seems unlikely at the moment. The SEC’s subpoenas of crypto firms and lack of engagement with potential issuers suggest that there are significant hurdles to overcome. With the SEC’s investigation into the original Ethereum ICO and its failure to communicate with applicants, it is becoming increasingly doubtful that ETFs will be authorized in May.
In conclusion, the SEC has extended the deadline for Grayscale’s Ethereum Futures ETF, giving themselves more time to review the proposal. However, the approval of both Ethereum spot and futures ETFs seems uncertain due to various factors such as regulatory investigations and lack of communication. Crypto investors will have to wait longer for potential investment opportunities in these ETFs.
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