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The approval race for a US Ethereum spot ETF has seen another twist, as the US Securities and Exchange Commission (SEC) has postponed decisions on applications from leading asset management firm Grayscale Investments and Franklin Templeton.
TLDR
Grayscale submitted an Ethereum spot ETF application form S-3 to the SEC, aiming to convert its Ethereum Trust (ETHE) into a spot Ethereum ETF.
Following a similar move by the Bitcoin mini ETF, Grayscale also filed an S-1 registration for a mini Ethereum ETF.
The SEC has postponed decisions on Grayscale and Franklin Templeton's Ethereum spot ETF applications to March 23 and XNUMX, respectively.
The SEC stated that it needs more time to consider the proposed rule changes and the issues raised therein.
Analysts are pessimistic about the approval of a spot Ethereum ETF by the SEC and express concerns about Ethereum's staking functionality and the SEC chairman's stance on cryptocurrencies as securities.
Grayscale, a prominent player in the cryptocurrency field, has been actively seeking to convert its Ethereum Trust (ETHE) into a spot Ethereum ETF. The company took a significant step by submitting Form S-3 to the SEC, a crucial move in its strategy to get approval for a spot Ethereum ETF. By submitting this form, Grayscale provided the SEC with the necessary documents to consider its proposal.
Grayscale has also filed an S-1 application for a mini Ethereum ETF, with the ticker symbol "ETH". Earlier, in January, the asset management firm took a similar step when it submitted an S-XNUMX registration for a mini Bitcoin ETF, with the ticker symbol "BTC", which is still awaiting SEC approval.
Grayscale's efforts go beyond regulatory filings; the company is also actively seeking to list its Ethereum Trust as a spot Ethereum ETF on the New York Stock Exchange's Arca exchange. This involves the submission of a Form 19b-4 by NYSE Arca, along with a supplemental S-3 filing by Grayscale. If approved, shares of the Ethereum Trust will trade under the ticker symbol "ETHE," with the ongoing issuance of shares depending on the effectiveness of NYSE Arca's application and the registration of the S-3 filing.
However, despite Grayscale's proactive approach, the US Securities and Exchange Commission has postponed decisions on Grayscale and Franklin Templeton's applications. The regulatory agency stated that it needs more time to consider the proposed rule changes and the issues raised therein, thus extending the deadline for Grayscale's application to March 23 and Franklin Templeton's application to XNUMX.
This delay has heightened speculation and emotions among industry participants, with some expressing concern about the lack of substantive engagement from SEC staff. They interpret this as a potential harbinger of the denial of impending deadlines. While some issuers remain hopeful, citing similarities between Ethereum and Bitcoin ETF situations, others are less optimistic.
Critics point out that unresolved issues surrounding Ethereum's staking functionality suggest that these complexities could hinder approval. There is also speculation about SEC Chairman Gary Gensler's stance, as some believe he may not approve a spot Ethereum ETF and may find new grounds for rejection, potentially leading Grayscale to initiate litigation, similar to the legal battles over spot Bitcoin ETFs.
Analysts at investment bank JPMorgan estimate the likelihood of approval for a spot Ethereum ETF before the March 50 deadline is less than XNUMX%. This cautious outlook reflects the SEC's determination to thoroughly review the submitted filings to ensure adequate protection of investor interests.
While Bitcoin ETFs have entered the US market, Ethereum ETFs are still awaiting their moment. The SEC's decisions, whether positive or negative, will undoubtedly have a significant impact on the cryptocurrency industry and the democratization of these digital assets to the public. |
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Post time 2-5-2024 12:22:18
