SEC Delays Decision on BlackRock’s Spot Ethereum ETF to March!

SEC Commissioner Hester Peirce states that this time, for the approval of Ethereum ETF funds, the SEC shouldn’t need a court to tell them they are acting capriciously. The agency is taking its time with the decision, extending it at least until March, possibly even until May.

“We shouldn’t need a court to tell us that our approach is arbitrary and capricious to get it right,” Commissioner SEC Hester Peirce said. “We won’t be approving it this way,” she added, referring to the court decision on Grayscale’s lawsuit, which sent the ETF application rejection back to the commission, a move that, according to Chairman Gensler, had a significant impact on the approval of these Bitcoin funds in the U.S.

A lot of work is needed in preparing an exchange-traded product for the market, including ensuring that the disclosed information corresponds to how the product actually operates, Peirce further explained. After hearing from the court that the approach we chose was wrong, […] I think such a lesson will definitely stick with us.

Senior ETF analyst at Bloomberg, Eric Balchunas, estimates a 70% chance of approval for a spot Ether ETF by May – when, according to the estimate, the SEC should approve all applications simultaneously.

The U.S. securities regulator has just postponed its decision on BlackRock’s spot Ethereum ETF, citing the need for more time to review the proposed rule change. This happened a day before the January 25 deadline.

This is the first of several delays that the SEC can apply during the 240-day period after Nasdaq, on behalf of BlackRock, requested the iShares Ethereum Trust on December 11. The current decision deadline is March, with the final deadline being August 7.

The SEC must also decide on VanEck’s application by May 23, ARK by May 24, while Grayscale Investments, Invesco Galaxy, and Fidelity Investments have final deadlines on June 18, July 5, and August 3.

Relationship between Bitcoin and Ethereum

The relationship between Bitcoin and Ethereum is crucial for the price movements of the latter, as historical data show a consistent correlation between ETH and BTC prices.

Approval of a Bitcoin ETF is expected to increase traditional investors’ exposure to cryptocurrencies, potentially boosting demand for ETH. This increased demand could have a potential price target of up to $3,870 by March 2024.

The ETH/BTC pair is currently at its long-term low around 0.05, the lowest since April 2021. This means that Ethereum is currently relatively inexpensive.

If spot funds for Ethereum are launched during the year, the second-largest cryptocurrency is undoubtedly poised for interesting growth.

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