The U.S. Securities and Exchange Commission (SEC) has postponed its ruling on Hashdex and ARK 21Shares spot Ethereum exchange-traded fund (ETF).
Ethereum (ETH) enthusiasts have been closely watching these developments as the final deadline approaches.
Chances of Ethereum ETF approval drop sharply
The postponement, announced on Tuesday March 19, extends the decision period until the end of May. Specifically, the SEC set the final decision dates for ARK 21Shares and Hashdex as May 24 and May 30, respectively.
The SEC stated that “the Commission has determined that it is appropriate to specify a longer period for issuing an order approving or disapproving a proposed rule change to allow sufficient time to consider the proposed rule change and the issues raised thereunder.” He said.
The price of Ethereum fell about 8% following the SEC’s announcement, indicating the market’s sensitivity to the regulatory decision. Ethereum currently trades around $3,100, reflecting the uncertainty surrounding ETF approval.
The delay affects several proposals for an Ethereum ETF, including notable submissions from industry giants such as BlackRock, Grayscale, and Fidelity. Sentiment has shifted recently, with analysts expressing skepticism about the likelihood of approval.
Read more: Ethereum ETF explained: What it is and how it works
For example, ETF analyst James Seyffart pointed out the lack of engagement between the SEC and Ethereum ETF issuers. In contrast to the active discussion about Bitcoin ETFs, this lack of conversation makes the outlook for Ethereum ETFs more pessimistic.
“My cautious and optimistic attitude toward the ETH ETF has changed in recent months. We now believe that in this round these will ultimately be rejected on May 23,” Seyffart said. Posted.
Moreover, market forecasts suggest that the probability of approval has decreased significantly as trust has declined significantly. According to Polymarket, the odds of approval for an Ethereum ETF in May have plummeted to 24%, a stark contrast to the 75% chance following the SEC’s approval of a spot Bitcoin ETF in January.
Amid these developments, Coinbase has emerged as a strong supporter of the Ethereum ETF. Last month, Coinbase’s Chief Legal Officer Paul Grewal released a detailed letter explaining the reasons for approving the Ethereum ETF.
Read more: Ethereum (ETH) price prediction for 2024/2025/2030
He classified Ethereum as a commodity, a view supported by the Commodity Futures Trading Commission (CFTC) and various SEC and court decisions. This claim is part of a broader effort to demonstrate Ethereum’s market stability and viability as an ETF.
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