SEC delays Invesco Galaxy spot ETH ETF, but May decisions are still expected

The U.S. Securities and Alternate Rate (SEC) extended the determination duration for Invesco and Galaxy’s quandary Ethereum ETF on Feb. 6.

The company’s announcement specifically concerns a proposed rule alternate from Cboe BZX that will allow it to list and alternate shares of the fund.

The SEC stated that the proposed rule alternate was published for comment in the Federal Register on Nov. 8, 2023. The company then designated a longer duration for approval on Dec. 13, 2023, extending the duration all by procedure of which it could per chance perchance approve, loathe, or institute complaints round approval or disapproval.

The company’s latest submitting implies that it has chosen the closing option, thereby instituting complaints for round approval or disapproval. The complaints request that commenters address fraud prevention, market manipulation, and investor protections. These factors are at play for all totally different pending Ethereum ETF proposals and were additionally key to the approval of quandary Bitcoin ETFs in January.

The SEC did now not present accurate chop-off dates lately. It stated that comments must be submitted within 21 days of e-newsletter in the Federal Register, and that rebuttal comments must be submitted within 35 days of e-newsletter in the equal.

SEC anticipated to decide on on ETH ETFs by Could per chance perchance perchance

The extension doesn’t have an effect on broader approval timelines for ETH ETFs. Bloomberg ETF analyst James Seyffart acknowledged the prolong, writing:

“[The] SEC glowing delayed [Invesco and Galaxy’s] Ethereum ETF. [This was] 100% anticipated and more delays will proceed to happen in coming months. The one date that matters for quandary Ethereum ETFs at the present is Could per chance perchance perchance twenty third. Which is VanEck’s closing chop lend a hand-off date date.”

It is a ways likely that the SEC will opt on numerous identical proposals on the equal time, including those that hold later chop-off dates than VanEck’s proposal.

The SEC has delayed totally different totally different quandary Ethereum ETFs in past weeks. The company extended the determination duration on choices from Fidelity on Jan. 18, BlackRock on Jan. 24, and Grayscale on Jan. 25. Over over again, those delays diagram now not have an effect on the broader Could per chance perchance perchance determination chop lend a hand-off date described by Seyffart.

It is a ways unclear whether or now not the SEC will settle to approve a quandary Ethereum ETF. One Polymarket prediction market presently suggests 43% odds of approval by Could per chance perchance perchance. Seyffart has instructed a 60% probability of approval by Could per chance perchance perchance, while one JP Morgan member has instructed a 50% probability of approval. A TD Cowen evaluate community believes that a quandary Ethereum ETF could per chance well now not be authorised in Could per chance perchance perchance.