Pessimism surrounding the approval of Spot Ethereum ETFs is expected to increase as the U.S. Securities and Exchange Commission (SEC) has done so. opted to delay its decision on the approval process for Invesco Galaxy’s ETH Spot ETF, fueling uncertainty in the crypto market.
SEC pushes back against Invesco’s Ethereum Spot ETF
In October last year, Invesco Galaxy deposit a proposed rule change to list and trade shares of its Ethereum spot ETF, Commodity-Based Trust Shares, with the SEC under the Securities Exchange Act of 1934 and Rule 19b-4 thereof , which was published in the Federal Register in November.
Invesco Galaxy Ethereum Spot ETF aims to mirror the performance of the Ether spot price, holding ETH units with a different custodian. The document states that Invesco is the sponsor and Galaxy Digital is the execution agent, responsible for selling ETH to cover the costs of the Trust. However, according to a document filed Monday, the Commission decided to postpone its decision on the company’s proposal.
The SEC said additional time was needed to analyze the associated concerns and the proposed rule change, emphasizing the need for more time to fully evaluate the spot ETF proposal. So, the regulatory watchdog gave an additional 60 days to approve or disapprove the proposal.
The file said:
The Commission believes that a longer deadline for issuing an order approving or disapproving the proposed rule change is appropriate to provide sufficient time to consider the proposed rule change and the issues raised therein.
Since the SEC has a total of 240 days from the publication date to grant extensions before making a final decision to approve or disapprove the application, the agency is expected to issue a final decision on the application. ‘Invesco Galaxy Ethereum Spot ETF by July 5, 2024.
Invesco Galaxy is the latest asset management firm to see its Spot ETF proposal delayed by the agency. Other notable companies like Blackrock have also suffered the same fate over time.
Blackrock’s proposed Spot Ethereum ETF was delayed in March, the second time the Commission has postponed the company’s proposal. So far, this repeated SEC delay has cast a dark shadow over exchange products within the crypto community.
ETH Spot ETFs See Pessimism in Top Crypto Numbers
Over time, Ethereum Spot ETFs have seen consistent negative sentiment from top executives in the crypto space, unlike Bitcoin, which has seen unwavering optimism from these numbers. Last month, Tron founder Justin Sun Express his disbelief that the products were approved before the May 31 deadline. “My (NFA) honest opinion is that an Ethereum ETF will not be approved in May,” he said.
Sun says the crypto industry still needs to prepare for a long educational process in order to help authorities and regulators understand cryptocurrency, although he believes the industry has already reached that stage.
Currently, the probability Acceptance of ETH Spot ETFs now stands at just 12%, which is a significant drop from 76% in January following the approval of Bitcoin Spot ETFs.
Featured image from iStock, chart from Tradingview.com
