The SEC’s Announcement
In two separate releases, the Commission announced that it was delaying its decision on the proposed rule change by the Cboe BZX Exchange to list and trade the shares of the VanEck Ethereum ETF and ARK 21Shares Ethereum ETF.
This decision comes just a day after the Commission announced extending the deadline to decide on ARK Invest’s Spot Bitcoin ETF application to January 10, 2024. A decision on ARK 21Shares Bitcoin ETF wasn’t due until November 11.
Similarly, the SEC delayed these pending ETH ETF applications weeks before the November 10 and 11 deadline for the VanEck Ethereum ETF and ARK 21Shares Ethereum ETF applications, respectively.
The SEC will now have an additional 45 days (which begins running from November 10 and 11) to decide on these applications, with the second deadline coming in December. According to the SEC’s releases, a decision on the VanEck Ethereum ETF is set for December 25, while a decision on the ARK 21Shares Ethereum ETF will come on December 26.
How This Could Play Out
Contrary to earlier reports, asset manager VanEck had filed for the first Spot ETH ETF, not ARK Invest. The former had filed its application as far back as May 7, 2021. Meanwhile, the Ark 21Shares Ethereum ETF was filed on September 6 this year.
Going by this and the SEC’s announcement, the asset manager could have a first-mover advantage over others if the applications were to be approved based on filing dates.
However, it remains to be seen if the SEC will approve any of these applications in the first place, as there is the likelihood that these applications could face the same treatment that the Commission has meted out to the pending Spot Bitcoin ETF applications.
Whatever happens, the court’s ruling in Grayscale’s case against the SEC would undoubtedly influence the Commission’s decision on these Spot ETH ETFs, especially if the pending Ethereum futures ETF were to launch as planned in October.
If those ETFs were to launch, VanEck and ARK Invest can also argue that their Spot Ethereum ETFs should be approved on the grounds that the court has ruled that the futures and spot market are correlated.
Meanwhile, if the SEC chooses to play this out till the end, the earliest a final decision on these pending Spot Ethereum ETF applications could be made is around May 23, 2024, according to Bloomberg analyst James Seyffart.