The SEC is asking Ethereum ETF applicants for a series of minor corrections that will delay their release and set a new possible date for approval on July 15, 2024.
The long-awaited approval and launch of Ethereum Exchange-Traded Funds (ETFs) has suffered a new delay. The US Securities and Exchange Commission (SEC) has returned S-1 forms to potential Ethereum ETF issuers with minor comments, requesting revisions to be submitted by July 8.
Reasons for the new delay of Ethereum ETFs
On July 3, 2024, the SEC reported that it had returned S-1 forms to prospective Ethereum ETF issuers with minor comments, requesting revisions to be submitted by July 8.
This request for corrections implies that at least one more round of filings will be required before the ETFs can begin trading. According to Bloomberg ETF analysts, Ethereum ETFs could potentially be listed next week or during the week of July 15th, pushing the potential launch to mid- to late July.
At this point, the SEC has not provided specific details on the comments made, but they are understood to be minor adjustments. This move reflects the SEC's cautious approach to approving new financial products, especially those related to cryptocurrencies, due to concerns about investor protection and market stability.
Applicant reactions
The various Ethereum ETF applicants have responded quickly to the SEC's request. Firms such as vaneck y Bitwise have updated their S-1 forms for SEC review, hoping to comply with the new requirements in time. Bitwise, in particular, filed an amendment to its S-1 ahead of schedule, stating that comments from the SEC were minimal and that the update was quick and straightforward.
Bloomberg ETF analyst James Seyffart mentioned on his X account (formerly Twitter) that he expects more amendments from other issuers throughout the week, and predicts that the ETFs could list later next week or during the week of July 15.
Impact on the Ethereum market
This new delay has created uncertainty in the cryptocurrency market, negatively impacting the price of Ethereum. While some analysts believe that the approval of an Ethereum ETF is imminent and could push the price of the cryptocurrency to new highs, others are more cautious and warn that the SEC could continue to delay the decision indefinitely.
Price volatility
The price of Ethereum has seen fluctuations following the announcement of the delay. On July 3, Bitcoin fell below €54.000 and Ethereum followed the same trend, resulting in the price dropping below €3.000. This volatility reflects investor anxiety over the lack of clarity surrounding the launch of ETFs.
market sentiment
While the delay has caused some disappointment among Ethereum enthusiasts, many analysts see this as a necessary step towards eventual approval. At this point, Eric Balchunas noted that despite the delay, he still expects the ETFs to launch in July.This optimism is based on the minor nature of the SEC's comments and the quick response by issuers to comply with the requirements.
Trading volume
A slight increase in Ethereum trading volume has been observed as traders react to the news. Some projects in the Ethereum ecosystem have also experienced fluctuations in their prices and activity as the market recalibrates its expectations.
Expectations continue for Ethereum ETFs
While this delay may seem like a setback, many in the industry see it as a necessary step in the approval process. The SEC’s close attention to the details of the filings suggests a careful approach that could ultimately benefit investors and the broader market.
As we approach mid-July, all eyes will be on the SEC and Ethereum ETF issuers, waiting to see if this new deadline finally marks the debut of Ethereum ETFs in the US market. The approval of an Ethereum ETF would be a major milestone for the cryptocurrency industry, as it would open the doors to greater institutional adoption and make investing in Ethereum easier for the general public.
