The Securities and Exchange Commission (SEC) has postponed its ruling on BlackRock’s request to introduce a spot Ethereum ETF until March.
As the largest fund manager globally, BlackRock submitted its application for a spot Ethereum exchange-traded fund (ETF) in November.
SEC Delays Decision on BlackRock Spot Ethereum ETF
According to a filing on the SEC website, the decision on BlackRock’s application for a spot Ethereum ETF, initially scheduled for January 25, has been deferred to March 10, 2024.
The SEC filing explained that the Commission deems it appropriate to extend the timeframe for taking action on the proposed rule change, ensuring ample time for a comprehensive assessment of the proposal and the associated concerns.
BlackRock’s CEO, Larry Fink, expressed his perspective in a CNBC interview, noting the value he sees in having an Ethereum ETF. Fink emphasized that the approval of such funds represents significant steps toward tokenization.
The delayed decision follows the recent approval by the SEC of nearly a dozen spot Bitcoin ETFs. Three commissioners – Hester Peirce, Mark Uyeda, and Chair Gary Gensler – favored these products.
BlackRock’s spot Bitcoin ETF received approval on January 10 and commenced trading the following day. The iShares Bitcoin Trust, associated with BlackRock, has proven to be the most successful among the 10 circulating ETFs, amassing $1.7 billion in assets under management.
Spot Ethereum ETF Decisions May Delay Further
On January 19, the Commission decided to defer its decision on Fidelity’s application to launch a spot Ethereum ETF, establishing a new deadline for March. Various companies, such as Ark Invest, Grayscale, and BlackRock, have submitted applications to initiate Ethereum-based spot funds, with Fink expressing support for this product category.
JPMorgan Chase has indicated skepticism about the SEC approving such funds in the spring of 2024, citing uncertainties surrounding Ethereum’s status.
Bloomberg Intelligence ETF analyst James Seyffart anticipates continued delays in spot Ethereum ETF approvals, suggesting potential regulatory complexities involving not only industry players but also the Commodity Futures Trading Commission (CFTC) if SEC Chairman Gary Gensler pursues regulation of Ethereum. He emphasized that such challenges might outweigh the benefits.
Spot Ethereum ETF Delays will continue to happen sporadically over the next few months. Next date that matters is May 23rd
— James Seyffart (@JSeyff) January 24, 2024
As Fox Business journalist Eleanor Terrett recently mentioned, media outlets anticipate approving spot Ethereum ETFs by the end of summer 2024.
While Terrett acknowledged the perceived complexity arising from Ethereum’s “opaque” status, her source expressed a contrary opinion. According to the source, the CFTC already categorizes Ethereum as a commodity.
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