SEC Prolongs Grayscale's Ethereum ETF Decision into 2024

By: Eva Baxter

The U.S. Securities and Exchange Commission (SEC) has decided to extend the deliberation period for the approval of a proposed rule change that would enable NYSE Arca to list and trade shares of the Grayscale Ethereum Trust as an exchange-traded fund (ETF). The new deadline is set for January 25th, 2024, extending from the typical 45-day decision-making timeframe.

The Grayscale Ethereum Trust, worth $5 billion, is viewed as one of the largest institutional investment vehicles for Ether. The proposed rule change could make the Trust more fluid by transforming it into a spot ETF, and potentially reducing the longstanding price disparity between the Trust and the underlying Ether assets.

Meanwhile, other significant financial players such as Fidelity and BlackRock are also showing interest in offering their own spot Ethereum ETFs. Despite this rising institutional interest, the SEC remains cautious, consistently extending decision deadlines and requesting further public feedback on such proposals in an effort to fully evaluate pertaining crypto-market factors such as market manipulation risks and custodial qualifications.