US SEC Pushes Back On Yet Another Spot Ether ETF Application As Key Deadline Looms

Wall Street’s top regulator has refused to make a decision on another high-profile spot, the Ethereum exchange-traded fund (ETF).

The US Securities and Exchange Commission (SEC) is delaying the decision on the next steps for a spot Ethereum (ETH) exchange-traded fund (ETF) jointly proposed by Invesco and Galaxy Digital.

In a Monday filing, the SEC gave itself another 60 days to decide on the Invesco Galaxy spot Ether ETF, with the next deadline set to July 5.

“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,” the agency said. 

The proposed product would allow professional investors to gain exposure to Ethereum without the hassle of buying and storing the second-largest crypto themselves. If greenlighted, the Ethereum Trust’s shares will be listed on the New York Stock Exchange and directly redeemable for the underlying ETH.

According to Bloomberg ETF analyst James Seyffart, May 23 is the final regulatory deadline for VanEck’s Ethereum ETF proposal and the “only deadline that matters.”

Diminished Hope For May Approval

The SEC has in recent months pushed back deadlines on applications from all eight potential Ether ETF issuers, including BlackRock, Fidelity, and Franklin Templeton, among others, in line with expert expectations. The securities regulator postponed its decision on the Invesco Galaxy Ethereum ETF in February and asked for public comment.

Optimism for the Securities and Exchange Commission giving the regulatory blessing to an Ether-based investment vehicle has dwindled over the past couple of months.

The lack of engagement between the SEC and prospective fund issuers, coupled with increasing scrutiny from SEC Chair Gary Gensler, has led experts to lower their odds of SEC approval by late May.

Tron founder Justin Sun also expressed doubts regarding the potential approval of spot ETH ETFs this month.

“My honest opinion (NFA) is that an Ethereum ETF won’t be approved in May. The crypto industry still needs to prepare for long-term education with regulators, focusing on helping them understand crypto. But we’ve always been here, haven’t we?” Sun postulated in a recent post on X.

With the prevailing pessimistic outlook, an SEC regulatory blessing would be a pleasant surprise, while a delay or denial could have negative implications for the market in the short term.