Key Points
The United States Securities and Exchange Commission (SEC) has chosen to postpone its verdict on Invesco Galaxy’s ETH Spot ETF.
This decision has led to a rise in pessimism surrounding the approval of Spot Ethereum ETFs.
The delay has fueled uncertainty within the cryptocurrency market.
SEC’s Delay on Invesco’s Ethereum Spot ETF
Invesco Galaxy submitted a proposed rule change to the SEC in October last year.
This change was intended to list and trade shares of its Ethereum spot ETF, Commodity-Based Trust Shares.
The SEC published the proposal in the Federal Register in November.
Invesco Galaxy’s Ethereum Spot ETF is designed to mirror the performance of the spot price of Ether.
This is achieved by holding ETH units with a separate custodian.
The proposal outlined that Invesco is the sponsor and Galaxy Digital is the execution agent.
The execution agent is tasked with selling ETH to cover the Trust’s expenses.
However, in a recent filing, the SEC has decided to delay its decision on the proposal.
The SEC stated that more time is required to review the related issues and the proposed rule change.
Hence, an additional 60 days have been granted to approve or disapprove the proposal.
The SEC has a total of 240 days from the publication date to approve or disapprove the application.
Therefore, a final decision on Invesco Galaxy’s Ethereum Spot ETF is expected by July 5, 2024.
Invesco Galaxy is not the only company to experience a delay in its Spot ETF proposal.
Other prominent companies like Blackrock have also faced similar delays.
Blackrock’s proposed Spot Ethereum ETF was postponed in March.
This marks the second time the SEC has delayed the company’s proposal.
These repeated delays have cast a shadow on exchange products within the crypto community.
Spot Ethereum ETFs have consistently received negative feedback from leading figures in the crypto space over time.
This contrasts with Bitcoin, which has received unwavering optimism from these figures.
Last month, Tron Founder Justin Sun voiced his skepticism about the products being approved by the May 31 deadline.
Sun believes that the crypto industry still needs to undergo a lengthy education process to help authorities and regulators understand cryptocurrency.
At present, the chances of the ETH Spot ETFs being accepted stands at a mere 12%.
This is a significant decrease from the 76% odds recorded in January following the approval of Bitcoin spot ETFs.
