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ETH ETF Application: Delayed, But Not Denied?

SEC has postponed Fidelity's Ethereum ETF decision, yet approval appears probable in 2024.

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ETH ETF Application: Delayed, But Not Denied?

Crypto News– The highly anticipated decision on Fidelity’s spot Ethereum ETF application has taken a detour, pushing the date back from its January deadline to March 5, 2024. According to the SEC, this extension allows for a more thorough review of the proposal and its surrounding concerns.

ETH ETF Application: Delayed, But Not Denied?

Industry experts, like Bloomberg Intelligence’s James Seyffart, expected the delay. He sees the real action happening towards the late May timeframe. Meanwhile, Fidelity joins other major companies like BlackRock, Ark Invest/21shares, and VanEck in their quest for a spot Ethereum ETF in the U.S. market.

Fidelity’s Ethereum ETF Decision Delayed by SEC, But Approval Seems Likely in 2024

Key Points:

  • The U.S. Securities and Exchange Commission (SEC) has postponed its decision on Fidelity’s proposed spot Ethereum ETF until March 5, 2024.
  • The SEC cites the need for “sufficient time” to consider the proposal and related issues.
  • Analysts remain optimistic about Ethereum ETF approval in 2024, but the timeline remains uncertain.
  • SEC Chair Gary Gensler’s stance on Ethereum’s classification as a security or commodity could influence the decision.

What’s Next for Ethereum ETF?

The coming months will be crucial for Fidelity’s spot Ethereum ETF. While the wait continues, industry observers will be closely monitoring Gensler’s statements and the SEC’s actions for any hints regarding the fate of this much-anticipated ETF. The ultimate decision could significantly impact the broader crypto market and Ethereum’s future within the U.S. regulatory landscape.

Optimism for Ethereum ETF Approval by May

Despite the delay, optimism for an eventual Ethereum ETF approval remains high. Eric Balchunas, another analyst at Bloomberg Intelligence, expressed confidence that an Ethereum ETF will indeed see the light of day in 2024, with a 70% chance of approval by May.

Balchunas’ conviction stems from the SEC’s prior approval of Ethereum futures ETFs, which he believes puts the regulator in a corner. He argues that the agency’s approval of Bitcoin futures ETFs led to a court order forcing them to review Grayscale’s spot Bitcoin ETF application. Last week’s approval of multiple spot Bitcoin ETFs by the SEC, with chair Gary Gensler acknowledging that “circumstances have changed,” further strengthens Balchunas’ case.

Gensler Reiterates Caution on Crypto Assets Beyond Bitcoin

While Gensler conceded to approving spot Bitcoin ETFs, he was quick to clarify that this decision is specific to Bitcoin and shouldn’t be seen as a green light for other crypto assets. He emphasized that “today’s Commission action is cabined to ETPs holding one non-security commodity,” Bitcoin, and that it doesn’t signal any change in the SEC’s stance on other crypto assets, including their status under federal securities laws.

Adding to the uncertainty, Gensler has consistently declined to clarify whether he considers Ethereum a security or a commodity. This ambiguity stems from his seemingly conflicting views. Prior to joining the SEC, Gensler stated that Ethereum is “not a security” due to its decentralized nature, echoing the opinion of former SEC official William Hinman. However, as SEC chair, Gensler has remained tight-lipped on the issue.

CFTC Sees Ethereum as a Commodity

In contrast to Gensler’s cautious approach, Rostin Behnam, chair of the Commodity Futures Trading Commission (CFTC), has openly stated his view that Ethereum should be considered a commodity. This divergence in opinion further complicates the regulatory landscape for Ethereum and other crypto assets.

The Road Ahead for Ethereum ETFs

While the delay in Fidelity‘s Ethereum ETF application is a temporary setback, it doesn’t necessarily signify defeat. Analysts remain confident that an Ethereum ETF will be approved by May 2024. However, the long-term outlook for other crypto assets remains uncertain as the SEC navigates the complex landscape of digital currencies and their regulatory status.

Grayscale’s Ethereum ETF Bid Under SEC Microscope, Public Comment Window Opens

The saga surrounding Grayscale’s long-awaited spot Ether exchange-traded fund (ETF) just took another turn, as the U.S. Securities and Exchange Commission (SEC) officially instituted proceedings on its application. This move opens the door for public feedback and pushes the decision deadline further down the road.

A 35-Day Public Input Delay: In a notice published January 25, the SEC announced its intention to determine whether to approve or disapprove Grayscale’s proposed rule change. This proposal seeks to allow NYSE Arca to list and trade shares of the Grayscale Ethereum Trust under an ETF structure. However, before reaching a decision, the SEC is inviting public comments, a process that will add 35 days to the timeline upon publication in the Federal Register.

Seeking Feedback on Ether Exposure: “Interested persons are invited to submit written data, views, and arguments regarding whether the proposed rule change should be approved or disapproved,” the SEC stated in the notice. This opens the door for anyone – individuals, institutions, or industry experts – to share their opinions on the implications of granting Grayscale’s Ethereum ETF ambitions.

ETH Following Bitcoin’s Footsteps: This development comes two weeks after the SEC gave the green light to the first wave of spot Bitcoin ETFs in the U.S., including Grayscale’s own Bitcoin Trust offering (GBTC). Interestingly, despite this approval, GBTC experienced significant outflows, suggesting some investors might be shifting their focus to Ethereum exposure.

A Long, Winding Road for Ethereum ETFs: Grayscale’s filing marks just one among several applications for spot Ether ETFs currently awaiting the SEC’s verdict. BlackRock’s bid, for instance, was recently pushed back to March, and experts anticipate a potential wait of up to 240 days for a final decision.

Implications for the Ethereum Ecosystem: The SEC’s scrutiny of Grayscale’s proposal signifies the high bar set for Ethereum-based ETFs. However, a potential approval could be a landmark moment for the Ethereum ecosystem, boosting investor confidence and paving the way for further Ethereum-related financial products.

Stay Tuned: While the wait for a verdict on Grayscale’s Ethereum ETF continues, the public comment window offers a unique opportunity for various stakeholders to weigh in on this pivotal decision. As the story unfolds, it’s crucial for investors and enthusiasts alike to stay tuned for the next chapter in the saga of Ethereum’s entry into the regulated ETF landscape.

BlackRock’s dream of launching a spot Ethereum exchange-traded fund (ETF) will have to wait a bit longer. The U.S. Securities and Exchange Commission (SEC) has pushed back its decision timeline to March 10, sparking uncertainty in the crypto community.

BlackRock Joins the Queue: BlackRock, the world’s largest asset manager, filed for its iShares Ethereum Trust in November, joining the likes of Fidelity and VanEck in vying for the coveted first-mover advantage in the Ethereum ETF space. However, similar to Fidelity’s application, BlackRock’s proposal has hit a regulatory roadblock.

Reasons for the Delay: In a Wednesday filing, the SEC stated the need for “sufficient time to consider the proposed rule change and the issues raised therein.” This suggests a thorough examination of the application, as Ethereum’s regulatory status remains a key point of contention.

May Day, Maybe?: While the March deadline casts a shadow of uncertainty, analysts like James Seyffart of Bloomberg Intelligence suggest “dates that matter” lie further ahead. According to Seyffart, May 23rd could be a pivotal date, offering a clearer picture of the SEC’s stance on Ethereum ETFs.

Optimism Battling Pessimism: The crypto community remains divided on the possibility of a spot Ethereum ETF. Some, buoyed by the recent approval of spot Bitcoin ETFs, hold onto hope for a May green light. Others, however, echo SEC Chair Gary Gensler’s cautious remarks, highlighting the distinct regulatory treatment of Bitcoin as a “commodity non-security.”

Gensler’s Caveat: During a recent media briefing, Gensler emphasized that the Bitcoin ETF approval “shouldn’t be read to be anything other than that,” casting doubt on a blanket endorsement of other crypto-based ETFs. This cautious stance adds another layer of complexity to the Ethereum ETF approval process.

Beyond BlackRock: BlackRock’s delay is just one piece of a larger puzzle. Several other Ethereum ETF proposals remain under SEC review, each facing the same regulatory hurdles. The coming months will be crucial in determining the fate of these applications and, by extension, the future of Ethereum’s accessibility for traditional investors.

Stay Tuned: With March now the key date on the calendar, the story of Ethereum ETFs is far from over. Investors and enthusiasts alike should stay tuned for further developments in the coming months, as the SEC’s decision will have significant implications for the crypto landscape as a whole.

Grayscale’s ETH ETF Hits Roadblock: SEC Calls for Public Comments, Delaying Decision

The long-awaited decision on Grayscale Investments’ spot Ethereum (ETH) exchange-traded fund (ETF) just took another detour. The U.S. Securities and Exchange Commission (SEC) announced Thursday that it’s instituting proceedings on the proposal, including a call for public comments, effectively delaying the verdict.

Grayscale’s ETH ETF Faces Public Scrutiny: This move signifies the SEC’s heightened scrutiny of Ethereum-based ETFs. The Commission cites legal and policy complexities as justification for opening the matter to public feedback. It seeks public input on crucial aspects like the Trust and Shares’ susceptibility to manipulation, the proposal’s adequacy in preventing fraud, and the overall transparency and liquidity of the ETH market.

A History of Delays: This isn’t the first time Grayscale’s ETH ETF ambitions have encountered a roadblock. Last month, the SEC pushed the decision deadline by 45 days, mirroring similar delays for BlackRock’s and Fidelity’s ETH ETF proposals.

Diverging Opinions on Approval: Analyst sentiments regarding the eventual approval remain divided. Bloomberg’s Eric Balchunas estimates a 70% chance of greenlighting by May, while Morgan Creek Capital’s Mark Yusko paints a less optimistic picture. Yusko cites the SEC’s general crypto skepticism and Chair Gary Gensler’s recent comments cautioning against interpreting Bitcoin ETF approval as a broader endorsement of crypto ETFs as factors working against Grayscale’s bid. He pegs the approval chances at “probably less than 50/50.”

Gensler’s Caveat: Adding fuel to Yusko’s concerns, Gensler’s remarks during a recent media briefing highlighted the potential hurdles. He emphasized that the Bitcoin ETF approval is “cabined to this one commodity non-security,” implying no guarantee of similar treatment for other crypto offerings, including ETH.

Market Slump While Decision Looms: While Grayscale’s fate hangs in the balance, the crypto market faces a downturn. ETH, along with most top 10 altcoins, has witnessed significant price drops in the past week, with ETH currently hovering around $2,218.

Stay Tuned: The SEC’s call for public comments opens a crucial window for various stakeholders to voice their opinions. As the story unfolds, investors and enthusiasts alike should keep a close eye on the evolving narrative surrounding Grayscale’s ETH ETF, a decision with wider implications for the Ethereum ecosystem and the future of crypto ETFs in the U.S.

Ethereum-Inspired Growth: Bitcoin’s Layer-2 Revolution Begins,

Key Takeaways:

  • Bitcoin’s L2 ecosystem is poised for growth, inspired by Ethereum’s success.
  • Existing solutions like Lightning Network pave the way, but new projects offer promising functionalities.
  • Projects like Stacks, Ark, and MintLayer address specific limitations and unlock new possibilities.
  • Bitcoin’s tailwinds from ETFs and the halving could fuel further L2 adoption and innovation.

Bitcoin, the OG of crypto, might be getting a fresh coat of paint. A new report by Spartan Group and Kyle Ellicott suggests that, like its younger sibling Ethereum, Bitcoin could see an explosion of layer-2 (L2) networks, alleviating congestion and unlocking new possibilities.

Following Ethereum’s Lead: Remember the skyrocketing NFT fees on Ethereum in 2021? L2 solutions like Polygon and Arbitrum emerged to ease the pressure. Now, Bitcoin, which faced similar congestion during its own NFT craze, could follow suit.

Beyond Lightning: Lightning Network, the pioneering Bitcoin L2 project, is already gaining traction. But prepare for new arrivals – projects like Stacks, Liquid, and Rootstock are aiming to bring smart contracts and faster transactions to Bitcoin’s slow-and-steady dance. This “Big Four” already handles most L2 activity on the network.

Innovation on the Horizon: The report doesn’t stop there. It highlights emerging projects like Ark (low-cost payments) and MintLayer (DeFi-optimized sidechain) as contenders to fill Bitcoin’s technical gaps.

Bitcoin, the venerable king of cryptocurrencies, faces a familiar foe: scalability. As demand for its limited blockspace grows, congestion threatens to stifle innovation and user experience. But a new report suggests a potential solution: the rise of Layer-2 networks.

Why Now? Several factors are fueling this potential L2 boom:

  • ETF Boost: The recent approval of Bitcoin ETFs in the U.S. has injected fresh momentum into the market.
  • Halving Ahead: The next Bitcoin halving, expected in 2024, could further drive adoption and inspire new use cases.

Learning from Ethereum: Ethereum’s L2 ecosystem is bustling with dozens of projects vying for attention. Bitcoin, although early in its L2 journey, can leverage this experience to accelerate its own growth.

Challenges Remain: Scaling solutions need careful design to avoid inheriting Bitcoin’s inherent limitations. Projects like Stacks’ Nakamoto Release, aiming for faster L2 transactions, are facing these challenges head-on.

The Future Beckons: This report paints a promising picture for Bitcoin’s future. If L2 technology takes root, the possibilities are endless – faster transactions, smart contracts, and a vibrant DeFi scene built atop the world’s first and most trusted blockchain.

Stay Tuned: With innovation brewing and adoption on the rise, Bitcoin’s next chapter appears filled with exciting possibilities. Keep an eye on the L2 space – it could be where the next big crypto revolution unfolds.

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