The U.S. Securities and Exchange Commission (SEC) announced on January 18th that it has decided to delay its decision on Fidelity’s proposed spot Ethereum exchange-traded fund (ETF). This delay pertains to a proposed rule change that would permit Cboe BZX to list and trade shares of Fidelity’s planned fund. The SEC stated that the initial filing for the proposed rule change was made on November 17, 2023, and it was published for public comment in the federal register on December 6, 2023. Previously, the SEC was required to either approve, reject, or institute proceedings to determine whether to disapprove the proposed rule change by January 20th. However, they have chosen to use a provision that allows them to extend the deadline by 45 days, pushing it to March 5, 2024. It is highly likely that the SEC will initiate proceedings on Fidelity’s ETF in March, similar to other pending funds under its consideration.
A significant factor in the decision-making process regarding Fidelity’s ETF is the upcoming May deadline. By May 23rd, the SEC must approve or reject VanEck’s competing spot Ethereum ETF proposal. Since the SEC has already initiated proceedings for VanEck’s application, it cannot further delay its decision. Typically, the SEC approves similar ETFs simultaneously, which indicates that all pending spot Ethereum ETFs will likely be decided upon in late May, despite some applications having later deadlines. It is crucial to note that Fidelity, VanEck, and several other applicants secured approval for spot Bitcoin ETFs on January 10th. However, this success does not guarantee approval for Ethereum ETF proposals. Public expectations are divided, with one prediction market on Polymarket currently reporting a 54% chance of spot Ethereum ETF approvals.
As of the time of this writing, Ethereum holds the second-highest market capitalization position, with its price experiencing a 2.47% decline over the past 24 hours. The market capitalization of Ethereum stands at $295.94 billion, accompanied by a 24-hour trading volume of $11.91 billion. It is essential to keep track of these figures as they reflect the current market sentiment towards Ethereum. Furthermore, the global cryptocurrency market is valued at $1.63 trillion, with a 24-hour volume of $63.06 billion. Bitcoin dominance currently stands at 49.61%, indicating its continued influence in the cryptocurrency market.
The SEC’s decision to delay the ruling on Fidelity’s spot Ethereum ETF has brought uncertainty to the market. While the delay was expected, it has significant implications for the future of ETFs in the cryptocurrency space. The upcoming May deadline for VanEck’s Ethereum ETF proposal will play a crucial role in shaping the SEC’s decision-making process. Traders and investors eagerly await the SEC’s rulings, as they will provide clarity on the future of spot Ethereum ETFs. Nevertheless, it is important to approach these developments with caution, as market sentiments and regulatory decisions can have a substantial impact on the cryptocurrency landscape.
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