Key Takeaways
- SEC announced an extension of the deadline from March 31 to May 30 to determine whether to approve the Grayscale Ethereum Futures Trust ETF
- SEC stated that it requires more time to consider the proposed rule change before making a decision
The Securities and Exchange Commission (SEC) has once again delayed its decision regarding the proposed Grayscale Ethereum Futures Trust exchange-traded fund (ETF), as detailed in a recent filing.
In the filing published on March 22, the SEC announced an extension of the deadline from March 31 to May 30 to determine whether to approve the Grayscale Ethereum Futures Trust ETF, which is designed to invest in Ethereum futures contracts.
“The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein,” stated the agency in the filing.
This delay follows a previous postponement in December 2023, where the SEC opted to gather additional public input regarding the potential listing of Grayscale’s futures ETF product.
Grayscale initially proposed listing and trading shares of the Grayscale Ethereum Futures Trust ETF under the New York Stock Exchange Arca Rule 8.200-E in September 2023.
Bloomberg ETF analyst James Seyffart suggested that Grayscale might be utilizing its futures ETF application as a strategic maneuver to sway the SEC’s decision towards approving its spot Ether ETF. Seyffart expressed skepticism regarding Grayscale’s intentions, suggesting that the application might serve as a “trojan horse” to obtain a 19b-4 order from the SEC.
Seyffart elaborated on his stance, highlighting Grayscale’s potential argument in favor of its spot Ether ETF application should the futures ETF gain approval. He emphasized the complexity of the situation, stating that both scenarios—approval or denial—could present challenges for the SEC.
The delay in the SEC’s decision aligns with Seyffart’s previous observations, suggesting that Grayscale’s approach is strategic and aimed at ultimately gaining approval for a spot Ethereum ETF. The decision regarding the Grayscale Ethereum Futures Trust ETF remains pending, with the SEC extending its review period to thoroughly assess the proposed rule change and associated considerations.
