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SEC Delays Decision on Franklin Templeton’s Spot Ethereum ETF
The U.S. Securities and Exchange Commission (SEC) has announced a delay in its decision regarding Franklin Templeton’s proposed spot Ethereum ETF, extending the deadline to June 11, 2024. This news comes from a filing made public today, leaving the future of this financial product uncertain for the time being.
Background of the Proposed Spot Ethereum ETF
The proposed ETF, initially filed in February, seeks to track the price of ether and would utilize Coinbase Custody Trust Company and the Bank of New York Mellon as custodians.
Reasons for the SEC’s Decision to Extend the Deadline
The SEC’s decision to extend the review period stems from a need for additional time to thoroughly evaluate the proposed rule changes and the complex issues surrounding the classification of Ethereum and its suitability for a spot ETF.
Market Response and Analyst Expectations
This move comes amidst a surge in applications for spot cryptocurrency ETFs, with industry giants like Fidelity and BlackRock joining the race. Analysts have revised their approval likelihood estimates, with growing uncertainty surrounding the approval of spot Ethereum ETFs.
Public Comment Period and Regulatory Concerns
Adding to the complexity surrounding spot Ethereum ETFs, the SEC has recently initiated a period of public comment regarding their potential approval. The commission is seeking feedback on proposals from Bitwise Ethereum Trust, Fidelity Ethereum Fund, and Grayscale Ethereum.
Despite initial optimism, the likelihood of a spot Ethereum ETF approval seems to have considerably waned. Industry figures have voiced skepticism about the approval prospects, predicting a prolonged period of inaction from the SEC on pending applications.
Democratic Senators have urged SEC Chair Gensler to exercise caution in approving crypto-based ETFs, citing potential risks to investors and concerns about inadequate regulatory safeguards.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
