Key Points
- The SEC has delayed its decision on the proposed Ethereum ETFs by Hashdex and ARK 21Shares.
- Analysts are questioning the likelihood of approval for the eight Ether ETF proposals.
The U.S. Securities and Exchange Commission (SEC) has postponed its decision on the proposed Ethereum exchange-traded funds (ETFs) by Hashdex and ARK 21Shares.
This delay was announced on March 19th, ahead of the agency’s “third deadline”. Final decisions are expected in late May.
Analysts Express Skepticism
Analysts are expressing increasing doubt about the approval of the eight Ether ETF proposals, including those from BlackRock, Grayscale, and Fidelity.
James Seyffart, a Bloomberg ETF analyst, expressed concerns over the lack of interaction between the SEC and the applicants. This raises questions about the future of these ETFs.
Seyffart’s previous optimism for Ether ETFs has waned in recent months. He now believes these will ultimately be denied on May 23rd for this round.
He also noted the SEC’s lack of engagement with issuers on Ethereum specifics, a stark contrast to the Bitcoin ETFs last fall.
Revised Odds and Future Developments
Eric Balchunas, another Bloomberg ETF analyst, has revised the odds of Ether ETF approval from 50% to 35%. He cited the lack of signs/sources that made him bullish for Bitcoin spot 2.5 months ago.
The public sentiment reflects this, with Polymarket odds for Ether ETF approval dropping from 77% in January to 32% by May.
In addition, Grayscale is considering adding staking to its Ether ETF application. They have outlined proposals in a “consent solicitation statement” to investors.
This suggests that Grayscale aims to alleviate inflationary pressures through staking, pending shareholder approval. If approved, Grayscale would align with ARK 21Shares, Franklin Templeton, and Fidelity, who recently incorporated Ether staking into their ETF applications.
It will be interesting to see how things unfold as the SEC has approved ether futures-like ETFs but hasn’t approved spot or mixed ether ETFs, unlike Bitcoin ETFs last fall.
