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SEC has extended its timeline for reviewing Fidelity's proposal for a spot Ethereum ETF until March 5, as indicated in a filing on Thursday.
The SEC stated that it deems it necessary to allocate a more extended period to assess the proposed rule change thoroughly, allowing ample time for consideration of the rule change and the associated concerns.
Fidelity initially submitted the application for the Fidelity Ethereum Fund in November. In its proposal, Fidelity referenced a court ruling from the previous year, highlighting a judicial assertion that the SEC had not provided a coherent rationale for rejecting spot crypto ETFs while permitting futures-based products.
This delay provides the SEC with additional time to weigh the options of approval, disapproval, or initiating further proceedings. Bloomberg Intelligence ETF analyst James Seyffart anticipated the SEC’s decision to delay, expressing his expectations for critical dates in late May.
Recently, the SEC granted approval for 11 spot Bitcoin ETFs to commence trading, prompting speculation within the industry about the potential approval of a spot Ethereum ETF.
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Fidelity, along with BlackRock, entered the competition for a spot Ethereum ETF in the latter part of the previous year. Notably, ether futures ETFs had already gone live a month before the submission of applications by these firms.
Stuart Barton, co-founder at Volatility Shares, emphasized the significance of the SEC’s approval of futures-based ETFs, suggesting a parallel approach to Ethereum and Bitcoin, indicating a likelihood of non-regulation as a security.