The Securities and Exchange Commission (SEC) has postponed until March its decision on BlackRock's request to introduce an ethereum spot ETF.
As the largest fund manager globally, BlackRock filed for a spot ethereum exchange-traded fund (ETF) in November.
SEC delays decision on BlackRock Spot ethereum ETF
According to a presentation On the SEC website, the decision on BlackRock's application for an ethereum spot ETF, initially scheduled for January 25, was postponed to March 10, 2024.
The SEC filing explained that the Commission believes it is appropriate to extend the deadline for taking action on the proposed rule change, ensuring sufficient time for a comprehensive evaluation of the proposal and associated concerns.
BlackRock CEO Larry Fink voiced his perspective in a CNBC interview, pointing out the value he sees in owning an ethereum ETF. Fink emphasized that the approval of such funds represents an important step towards tokenization.
The delayed decision follows the SEC's recent approval of nearly a dozen spot bitcoin ETFs. Three commissioners (Hester Peirce, Mark Uyeda and Chairman Gary Gensler) were in favor of these products.
BlackRock's bitcoin spot ETF received approval on January 10 and began trading the following day. The iShares bitcoin Trust, partnered with BlackRock, has proven to be the most successful among the 10 ETFs in circulation, amassing $1.7 billion in assets under management.
Spot ethereum ETF decisions may be further delayed
On January 19, the Commission decided to defer its decision on Fidelity's application to launch an ethereum spot ETF, setting a new deadline for March. Several companies, such as Ark Invest, Grayscale, and BlackRock, have filed applications to start ethereum-based spot funds, and Fink expressed support for this product category.
JPMorgan Chase has expressed skepticism about the SEC approving such funds in spring 2024, citing uncertainties around the status of ethereum.
Bloomberg Intelligence ETF analyst James Seyffart anticipates continued delays in ethereum ETF spot approvals, suggesting potential regulatory complexities involving not only industry players but also the Commodity Futures Trading Commission (CFTC) if SEC Chairman Gary Gensler seeks to regulate ethereum. He stressed that such challenges could outweigh the benefits.
ethereum Spot ETF delays will continue to occur sporadically over the coming months. The next date that matters is May 23. https://t.co/2zBBvHkrVk
-James Seyffart (@JSeyff) January 24, 2024
As Fox Business journalist Eleanor Terrett recently mentioned, the media is anticipating approval of ethereum spot ETFs by the end of summer 2024.
While Terrett acknowledged the perceived complexity arising from ethereum's “opaque” state, his source expressed a contrary view. According to the source, the CFTC already classifies ethereum as a commodity.
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