The SEC postponed Grayscale’s decision to launch an Ethereum ETF until June 23.
More than $12 billion has been invested in Grayscale’s Bitcoin ETF.
This week, Grayscale Bitcoin Trust had a 50% decline in volume.
Regarding Grayscale’s request for a spot Ethereum ETF, the Securities and Exchange Commission (SEC) of the United States has deferred its judgment. The SEC extended the review period until June 23rd. This verdict is another delay in the U.S. government’s clearance procedure for exchange-traded funds (ETFs) based on cryptocurrencies.
To authorize the conversion of its existing Ethereum Trust into a spot ETH ETF, Grayscale submitted Form 19b-4 to NYSE Arca in October. Grayscale transformed its Bitcoin Trust into a spot Bitcoin exchange-traded fund in January.
Grayscale Has to Wait for Approval of Ethereum ETF
The SEC’s decision to postpone is justified by concerns and modifications under review for the proposal. The authority requires longer periods to evaluate revisions and resolve issues effectively. They are thoroughly examining to ensure compliance with all legal requirements. This ensures a comprehensive assessment and resolution of any outstanding concerns.
This is not a Grayscale-only issue. Similar applications from other asset managers have also been delayed by the SEC. To be noticed is that Franklin Templeton’s application has been pushed back until June 11. Fidelity, VanEck, and BlackRock have also experienced significant delays.
Concerned, the SEC halts the Ethereum ETF.
Grayscale has repeatedly improved its application in response to the SEC’s most recent action. To continue its operations about the Ethereum ETF offering, the company filed Form S-3 in compliance with the U.S. Securities Act. Grayscale’s efforts demonstrate their commitment to winning approval.
The delay in approving spot Ethereum ETFs demonstrates the ongoing regulatory worry. Analysts warn that some programs may have problems if additional features are added. The majority of cryptocurrency assets are securities, as emphasizedSEC Chairman Gary Gensler emphasized. This viewpoint might be influencing the SEC’s cautious stance toward these ETFs.
Even in the face of losses, the crypto ETF market has seen much activity. Over $12 billion in net inflows have been reported since the approval of the spot Bitcoin ETF. On the other hand, Grayscale’s Bitcoin Trust experienced massive withdrawals, with a 50% decline in the managed volume this past week.
