US SEC Delays Decision on Grayscale's Spot ETH ETF Application

CryptoNews.com

2024-01-25 20:10:35

Jai Pratap

Last updated:

January 25, 2024 23:09 EST | 1 min read

Source: Dalle-EThe U.S. Securities and Exchange Commission (SEC) delayed its decision on an application by crypto asset manager Grayscale Investments to convert its Ethereum trust product into a spot exchange-traded fund (ETF) on Thursday, as per a Reuters reported.

A day before the US regulator had delayed its decision on asset manager giant BlackRock’s application to launch a similar product to March 10, 2024. However, the delays did not come as a surprise as analysts showed little hope for approval before May this year.

SEC Chair Dampens Enthusiasm Over ETH ETFs Approval

The likelihood of Ethereum ETF applications gaining approval in the immediate future has been tempered by Securities and Exchange Commission Chair Gary Gensler. In a media briefing held on January 24th, Gensler emphasized that the recent green light given to Bitcoin ETFs by the agency was specifically for Bitcoin and not a broader endorsement for other cryptocurrencies.

This clarification is notable in light of speculations in certain circles that Ethereum ETFs might be the next in line for regulatory approval. Gensler addressed these expectations during the briefing, stating, “As I mentioned two weeks ago, the actions taken regarding bitcoin exchange-traded products are limited to this particular commodity, which is non-security, and should not be construed to imply anything beyond that.”

Spot Bitcoin ETFs Approval Mark a New Beginning for Crypto

A recent breakthrough in the crypto sector came with the approval of 11 spot bitcoin ETFs by the SEC earlier this month. This marked a pivotal moment for the industry, which had been advocating for regulatory approval of such products for over a decade.

These ETFs, designed to track the market price of the underlying digital asset, offer investors a convenient avenue to gain exposure to the token without directly purchasing the currency.

The approval sparked widespread enthusiasm and raised expectations of increased integration between traditional finance and the crypto industry through the introduction of these ETFs. As a result, there has been a notable surge in the value of crypto tokens and related industry stocks, reflecting the optimism surrounding this development.

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