SEC postpones decision on Grayscale’s proposed ETH ETF rule change

The SEC has until Jan. 1, 2024 to make a decision

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Shubham Dhage/Unsplash modified by Blockworks

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The Securities and Exchange Commission on Wednesday announced that it will “designate a longer period within which to take action on the proposed rule change” for Grayscale’s Ethereum Futures Trust. 

The filing pushes the deadline to Jan. 1, 2024. 

In the filing, the SEC said that the “Commission shall either approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change.” Essentially, the regulatory agency has another window to push back a decision.

Bloomberg analyst James Seyffart posted on X that the delay of the 19b-4 filing was not “remotely surprising.”

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Grayscale filed in early October to convert its Ethereum Trust into an ETF. 

“As we file to convert ETHE to an ETF, the natural next step in the product’s evolution, we recognize this as an important moment to bring Ethereum even further into the US regulatory perimeter,” Grayscale CEO Michael Sonnenshein said in a statement at the time. 

In August, Grayscale scored a court win against the SEC after it sought to convert its bitcoin trust (GBTC) to an ETF. 

The judges didn’t order the SEC to give Grayscale’s proposal a greenlight, but rather ordered the regulatory body to re-examine the application it originally denied. 

The panel of judges agreed that the original denial, but the allowance of bitcoin futures ETFs was “arbitrary and capricious.”

Alongside spot bitcoin ETFs, firms are now vying to get spot ether ETFs off the ground. Ark Invest and 21Shares plan to introduce five funds holding both bitcoin futures and ether futures this week. Both filed for the products back in August. 

In early October, six ETFs holding ether futures launched, with roughly $20 million or so in combined assets under management as of early November. 

Additionally, ETF watchers are keeping a close eye on the SEC’s approach to the spot bitcoin ETFs after big traditional finance firms such as BlackRock threw their hats in the ring. 

The SEC also postponed decisions on the big ETFs in late September ahead of a potential government shutdown.


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