The U.S. Securities and Exchange Commission (SEC) has once again delayed its decision on the applications for spot Ethereum exchange-traded funds (ETFs) submitted by Hashdex and ARK 21Shares. The regulatory body has chosen to extend the review period in order to carefully consider the potential impact and regulatory concerns associated with these proposed Ethereum ETFs.

According to recent filings, the SEC believes it requires additional time to thoroughly evaluate the proposed rule changes and the issues raised in relation to these ETF applications. The SEC’s decision to designate a longer period reflects its intention to make a well-informed determination.

The new decision date set by the SEC is May 30, 2024. On or before this date, the SEC will either approve or disapprove the applications for spot Ethereum ETFs submitted by Hashdex and ARK 21Shares.

It is not uncommon for the SEC to extend the review period for ETF applications, particularly for cryptocurrency-related ETFs. The SEC carefully assesses factors such as market manipulation concerns, investor protection, custody arrangements, and overall market integrity before making a decision on these investment products.

The delay in the SEC’s decision underscores the complexity and regulatory considerations associated with introducing cryptocurrency ETFs. It is important for market participants and investors to closely monitor regulatory updates and official announcements from the SEC for further insights into the status and potential approval of Ethereum ETFs.

Bloomberg Analysts Express Doubt Over Approval of ETH ETF

Bloomberg Intelligence ETF analysts James Seyffart and Eric Balchunas have expressed their calibrated predictions regarding the pending approvals of Ethereum ETFs, with a potentially pessimistic outlook for approval in May.

Balchunas stated that their odds of Ethereum ETF approval by the May deadline have decreased to 35%. He noted that while there are reasons why the SEC should approve the ETFs (and their personal belief aligns with approval), the indicators and sources that previously made them optimistic about Bitcoin spot ETFs are not present this time around.

These analysts likely consider various factors that could influence the SEC’s decision, including regulatory concerns, market manipulation risks, custody arrangements, and investor protection. The previous optimistic sentiment for Bitcoin spot ETFs may have been driven by specific market dynamics and developments that are not yet evident for Ethereum ETFs.

It’s worth noting that these predictions are speculative and based on the analysts’ assessment of the current landscape. The final decision on the approval of Ethereum ETFs lies with the SEC, which meticulously evaluates each application based on its own criteria and considerations.

Market participants and investors should remain updated on regulatory developments and official statements from the SEC to gain a clearer understanding of the potential approval or denial of Ethereum ETFs.

 

James Seyffart, a Bloomberg Intelligence ETF analyst, has echoed the sentiment expressed by Eric Balchunas, stating that his previously cautious optimism for Ethereum ETFs has changed. Seyffart now believes that the SEC will ultimately deny the applications for Ethereum ETFs on May 23rd.

The analysts’ change in outlook may be attributed to the SEC’s limited interactions with the Ethereum ETF applicants, which they perceive as a departure from the regulatory body’s approach to previously approved spot Bitcoin ETFs. The lack of engagement from the SEC could be seen as a signal that the authority’s attitude towards Ethereum ETFs is different or less supportive compared to Bitcoin ETFs.

Moreover, Seyffart shared on social media that the SEC is expected to delay its decision on other ETF applications in the near future. This suggests that the SEC may require more time to thoroughly evaluate and address the regulatory concerns associated with cryptocurrency ETFs.

It’s important to note that these predictions and observations are based on the analysts’ interpretations of the SEC’s actions and statements. The final decision on Ethereum ETFs and other applications rests with the SEC, and the regulatory landscape can be subject to change. Market participants and investors should continue to monitor updates and official announcements from the SEC for the latest information on ETF approvals and rejections.

 

According to the analyst, there are expectations of further delays in the approval process for Ethereum ETFs. The analyst suggests that at least three more Ethereum ETF applications, including those from VanEck, Ark/21Shares, Hashdex, and Grayscale, are likely to face delays in the next 12 days.

Delays in the approval process are not uncommon for ETF applications, particularly in the cryptocurrency space. Regulatory bodies such as the U.S. Securities and Exchange Commission (SEC) carefully evaluate ETF applications, considering factors such as market manipulation risks, investor protection, custody arrangements, and overall market integrity.

The anticipated delays for these Ethereum ETF applications indicate that the SEC may require additional time to thoroughly assess the proposed ETFs and address any regulatory concerns. It’s important to note that these delays do not necessarily indicate a rejection of the applications but rather an extended evaluation period.

Market participants and investors should continue to monitor official announcements and regulatory updates from the SEC regarding the status and potential approval of Ethereum ETFs.

By ailf

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