• The SEC is delaying its decision on whether to approve or reject spot Ethereum ETF proposals from Franklin Templeton and Grayscale
• The new deadline for the SEC to make a decision on Franklin Templeton’s spot Ethereum ETF is June 11, 2024
• The new deadline for the SEC to make a decision on Grayscale’s spot Ethereum ETF is June 23, 2024
The Securities and Exchange Commission (SEC) is postponing its decision on whether to approve spot Ethereum exchange-traded funds (ETFs) proposed by Franklin Templeton and Grayscale Investments. This delay highlights the ongoing regulatory uncertainty surrounding cryptocurrency ETFs in the US.
SEC Pushes Back Deadline for Franklin Templeton ETF
The SEC has extended its deadline for deciding on the Franklin Templeton Ethereum ETF to June 11, 2024. After this date, the agency could approve or deny the proposal, or initiate additional proceedings.
Franklin Templeton first submitted its proposal for a spot Ethereum ETF in February 2024. The proposed fund aims to reflect the price of ether, with Coinbase Custody Trust Company and Bank of New York Mellon serving as custodians.
Grayscale Ethereum Trust Decision Also Delayed
In addition to the Franklin Templeton proposal, the SEC has delayed making a determination on converting Grayscale’s existing Grayscale Ethereum Trust into a spot Ethereum ETF.
Grayscale originally filed for this conversion alongside NYSE Arca in October 2022. Earlier this year, Grayscale successfully converted its Grayscale Bitcoin Trust into a spot bitcoin ETF after a court order and SEC approval.
For the Grayscale Ethereum Trust conversion, the SEC has postponed its decision deadline to June 23, 2024.
Regulatory Outlook Remains Uncertain
The SEC has already deferred decisions on other proposed spot Ethereum ETFs from asset managers like VanEck and BlackRock.
Despite increasing industry interest, optimism around SEC approval of a spot ether ETF has declined in recent months. The SEC continues taking a cautious approach to crypto ETFs amid concerns around potential impacts on investor protection and market integrity.
However, spot bitcoin ETFs approved in 2024 have seen significant inflows, demonstrating underlying demand. As the crypto ETF landscape evolves, the latest delays keep the outlook uncertain for a spot Ethereum ETF hitting the US market.
Conclusion
The SEC is still evaluating whether to allow spot Ethereum ETFs from mainstream financial firms to launch in the US. While the crypto industry awaits greater regulatory clarity, investors can expect ongoing deliberation and delays before any approvals materialize. The coming months will determine if regulators believe the market is ready for this new crypto investment vehicle.
