The Securities and Exchange Commission (SEC) has once again deferred its decision on whether to approve the proposed Grayscale Ethereum Futures Trust exchange-traded fund (ETF), according to a recent filing.
In a document filed late on Friday, the SEC announced that it would extend its review period until May 30, 2024, to consider the approval of Grayscale’s ether futures ETF. The agency stated, “The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein.”
Bloomberg ETF analyst James Seyffart commented on the delay, noting that it was expected. Seyffart previously suggested that Grayscale’s strategy may involve using the ETF proposal as a means to eventually gain approval for a spot Ethereum ETF. He stated, “I doubt Grayscale even intends to launch this. It’s nothing but a trojan horse to get a 19b-4 order from the SEC.”
The SEC has previously postponed its decision on Grayscale’s ether futures ETF several times, with the most recent delay occurring in December, following a request for public comments.
While the SEC has approved a batch of ether futures ETFs in October 2023, including offerings from ProShares, VanEck, and Bitwise, the focus of the crypto industry has been on a spot ether ETF. This type of ETF provides investors with exposure to the cryptocurrency without requiring direct purchase or custody of the asset.
Major financial institutions, including Fidelity and BlackRock, have applied for spot ether ETFs in recent months. However, optimism for SEC approval of such a product has waned in recent weeks. Bloomberg ETF analyst Eric Balchunas recently lowered his estimate of the chances of a spot Ethereum ETF approval by May from about 70 percent to 30 percent.