SEC Extends Decision on Ethereum ETFs, Pushes Approval Timeline to May 2024

SEC extends evaluation period for Ethereum ETF applications, invites public commentary.

The U.S. Securities and Exchange Commission (SEC) has postponed its verdict on the approval of Ethereum exchange-traded funds (ETFs) applications from multiple asset management companies until May 2024.

The SEC has issued delay orders for Ethereum ETF applications from Ark Invest/21Shares, VanEck, and Hashdex, as revealed in numerous filings. These firms submitted their applications to initiate Ethereum ETFs in September. The products from VanEck and Ark Invest/21Shares aim to track the spot price of Ether (ETH), while Hashdex plans to introduce a hybrid fund that combines spot and futures price movements.

The SEC has initiated proceedings to decide whether to approve or reject the proposed rule change that would allow the listing of the product shares. The filings are currently open for public comments and will continue to be for 35 days following the publication of the applications in the Federal Register.

The SEC clarified that the initiation of proceedings does not imply that the Commission has made any determinations regarding the issues involved. The Commission invites interested individuals to submit written presentations of their perspectives, data, and arguments concerning the identified issues, as well as any other concerns they might have with the proposal.

The Commission’s recent action has pushed the final date for the approval or rejection of the proposals to May 2024. This is despite the fact that the delay orders for VanEck, Ark Invest/21Shares, and Hashdex were originally due by December 25, 26, and January 1, respectively.

This news follows shortly after the SEC extended the deadlines for Ethereum ETF applications from Invesco/Galaxy Digital and Grayscale Investments. Invesco/Galaxy Digital plans to launch a new spot Ethereum ETF, while Grayscale Investments aims to transform its Grayscale Ethereum Trust (ETHE) into a spot product. The initial decision for the Invesco Galaxy Ethereum spot ETF was set for December 23; however, the delay has moved the new date to February 4. Meanwhile, the public comments period for Grayscale has concluded, but the SEC has decided to allocate more time to determine whether the proposed rule change will be approved.

In the meantime, the crypto community is eagerly awaiting the approval of approximately 13 applications for spot Bitcoin ETFs by January.