Not everything goes as smoothly with any ETF that lands in Gary Gensler’s hands for approval. This time, the U.S. Securities and Exchange Commission has postponed the decision on the asset management proposal for an Ether exchange-traded fund (ETF) by Fidelity.
Read More on ETFs: Bitcoin and Gold Approach the Highest Correlation After ETFs Hit the Market
The SEC stated that it is extending the review period by an additional 45 days, “to give them enough time to consider the proposed rule change and the raised questions.” Meanwhile, five more Bitcoin ETFs with leverage have just been submitted to the regulator for approval.
On January 18, Direxion submitted applications for not one, not two, but a whopping five Bitcoin ETFs to the SEC. They’re following in the footsteps of ProShares, who joined into the Bitcoin ETF competitions with a high-five of their own on January 16, and REX Shares, the early birds of the year, with a six-pack of Bitcoin ETFs with leverage submitted on January 3.
Postponed Decision on Ethereum ETF
The Securities and Exchange Commission has extended the review period for Fidelity’s Ethereum spot ETF. Initially planned for a decision by January 20, 2024, the SEC has pushed the deadline back to March 5, 2024. This delay grants the SEC some extra time to evaluate the proposed rule change and tackle any issues that may arise.
Bloomberg ETF analyst James Seyffart, in a tweet on January 18, stated that he “fully expected” the delay.
This failure challenges grand plans for Cboe BZX Exchange to list and trade shares of the Fidelity Spot ETF under BZX Rule 14.11(e)(4), the one about commodity trust shares.
Analyst’s Predictions Regarding Ethereum ETF Approval
Opinions are divided on the likelihood that the SEC will approve spot ETFs at all. Some analysts foresee a scenario where the SEC greenlights several pending applications for spot Ethereum ETFs all at once, as it did for spot Bitcoin ETFs.
Earlier this month, Bloomberg ETF analyst Eric Balchunas estimated a 70% chance of spot ETF approval by May, based on the SEC’s deadline for the VanEck fund.
On the flip side, Mark Yusko, the co-founder and CEO of Morgan Creek Capital, said that the SEC is still giving crypto the cold shoulder, despite their thumbs-up to a Bitcoin ETF. He even hinted that the regulator might classify ETH as a security, unlike Bitcoin, which SEC head Gary Gensler considers a commodity.
Related to ETFs:
- What Does Spot Bitcoin ETF Mean for Investors?
- Bitcoin Critically Fell After the ETF Approval. What’s Next?
- Fake Bitcoin ETF Tweet Triggers SEC and Twitter Investigations
After all, a postponed decision is not the end of the world, is it? SEC’s decision to extend the review period just underscores the regulatory body’s cautious approach to digital assets. They’re taking their time to meticulously evaluate the potential impact of introducing such a fund into the market.
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