SEC calls for comments on Fidelity, Grayscale and Bitwise spot Ether ETF applications

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The United States Securities and Exchange Commission (SEC) is soliciting comments from the public on proposed rule changes allowing the listing and trading of shares of three spot Ether (ETH) exchange-traded funds, or ETFs, on exchanges. 

In separate notices filed on April 2, the SEC said the public had 21 days to respond upon publication in the Federal Register to spot ETH ETF proposals from asset managers Bitwise, Fidelity and Grayscale. The proposed ETF filings from Bitwise and Grayscale for listing and trading on NYSE Arca and from Fidelity on the Cboe BZX Exchange came ahead of the commission’s final decision on the investment vehicle, which is expected in May.

“Nothing in the filings signal to me that anything has changed,” said Bloomberg ETF analyst James Seyffart in an April 2 X post. “Silence from the SEC isn’t a good thing here.”

He added on April 3:

“Asking for public comments on a 19b-4 is standard procedure. Every single 19b-4 ETF filing goes through the same process (whether approved or denied). It’s not ‘bullish’ in any capacity for Ethereum ETFs.”

The SEC approved several spot Bitcoin (BTC) ETFs for the first time in January following scrutiny from investors and media outlets, with Chair Gary Gensler casting the deciding vote. However, many analysts have speculated the odds of the commission making a similar decision on Ether ETFs have steadily dropped in 2024.

Related: Ether ETF is less likely than Bitcoin ETF was — Recharge Capital Managing Partner

A spot Ether ETF application from VanEck, with a final deadline set for May 23, will likely be the first filing the SEC addresses. Several other asset managers have similar filings in the pipeline, including those from Hashdex and ARK 21Shares.

A reported investigation by the SEC into the Ethereum Foundation could challenge the commission’s decision to approve or deny a spot ETH ETF by classifying the digital asset as a security. Blockfirm firm Consensys submitted a comment letter to the SEC in March claiming that the regulator’s concerns about potential fraud and market manipulation for a spot ETH ETF were baseless.

Magazine: Ether ETFs face Senate opposition, Wright is not Satoshi, and Dencun goes live: Hodler’s Digest, March 10-16