SEC Delays BlackRock’s Ethereum ETF Decision, Anticipating New Ruling in March

The Securities and Exchange Commission (SEC) has recently announced that it is extending the timeline for its decision on BlackRock’s proposal for a spot Ethereum exchange-traded fund (ETF). The regulatory body has stated that it requires additional time to thoroughly assess the proposed rule change and address any concerns that may arise.

The new deadline for the SEC’s decision is set for March 10, giving the commission time to either approve, disapprove, or initiate further proceedings regarding BlackRock’s iShares Ethereum Trust. This innovative investment vehicle has garnered attention as it seeks regulatory approval to become a spot Ethereum ETF.

BlackRock, with its application for the iShares Ethereum Trust in November, has become a major player in the cryptocurrency market. As the largest asset management firm with over $9.1 trillion in assets under management, its entry into the spot Ethereum ETF space has generated significant interest.

This extension in the SEC’s decision timeline is the first of potentially several within a 240-day window. Other contenders, including VanEck, ARK 21Shares, Fidelity, Invesco Galaxy, Grayscale, and Hashdex, are also seeking approval for their spot Ether ETFs. Each of these companies has specific deadlines ranging from May to July.

The recent approval of 11 spot Bitcoin ETFs by the SEC has spurred companies like BlackRock to seek similar approval for Ethereum ETFs. BlackRock’s Bitcoin ETF has already seen significant inflows within just two weeks, surpassing the Grayscale Bitcoin Trust, which experienced outflows after its conversion from a closed fund.

JPMorgan’s analysis of Ethereum’s ETF prospects highlights the cryptocurrency’s shift from proof-of-work to proof-of-stake in 2022. This transition will impact decentralization and align Ether more closely with altcoins beyond Bitcoin. JPMorgan also acknowledges the SEC’s previous classification of some altcoins as securities, estimating that the likelihood of the SEC approving the Ethereum ETF by May is no more than 50%.

Given the dynamic changes occurring in the cryptocurrency landscape, the SEC’s decision on BlackRock’s Ethereum ETF will have significant implications for the broader market and investor sentiment.