Speed Bumps Ahead for Ethereum ETF Applications

 

Following up on the ETFs saga, the U.S. Securities and Exchange Commission (SEC) has decided to postpone its decision regarding a previously proposed spot ether (ETH) exchange-traded fund (ETF).

As disclosed in a recent filing, this involves a joint venture between Invesco and Galaxy Digital – two applicants for a spot ETH ETF.

A Tuesday SEC filing shows that Wall Street’s top regulator has pushed back its decision on approving or denying the jointly proposed product from both asset management giants.

For more context, the two firms filed the application last September.

This move by the SEC has fuelled the ongoing uncertainty surrounding the regulatory landscape of cryptocurrency investment products in the United States.

 

Source: X

Why does an ETH ETF matter for you?

The main goal behind the proposed spot ether ETF is offering professional investors direct exposure to the Ethereum network’s native cryptocurrency, ether.

The investment vehicle, if approved, would allow investors to gain exposure to the second-biggest digital asset, ETH, without the need to buy and store it themselves.

Did you know? The introduction of a Bitcoin spot ETF has fuelled institutional interest and wider adoption of BTC.

While market sentiment was estimating that such a product would disrupt Wall Street, it has been proven otherwise.

The hype surrounding the BTC ETFs has been noticed across several market participants, and subsequently, once the product has been approved, BTC’s price soared.

Analysts like British bank Standard Chartered now believe that an ETH ETF will arrive by May. The bank has argued that the product was likely to be approved by the regulator, mainly because the SEC has not declared ETH as a security.

Fun (yet annoying) fact: The SEC is known for often delaying making quick decisions. This year, it has postponed spot ETH ETF applications from big-name companies like BlackRock and Fidelity.

This delay has prompted mixed reactions among investors. While some remain cautiously optimistic about the eventual introduction of Ethereum-based investment products, others express concerns over the prolonged uncertainty surrounding regulatory approval processes.

However, this scenario is something we’ve seen before.

The SEC had repeatedly said no to approving Bitcoin ETF for the best part of the decade – but in January it finally gave the green light to the long-awaited product.

So, who’s to say we don’t see an ETH ETF sooner than later?