The United States Securities and Exchange Commission (SEC) has opened the floor for public input on a proposed rule change that would greenlight the listing and trading of shares for the Invesco Galaxy Ethereum ETF on the Cboe BZX Exchange.
In a notice published on Tuesday, February 7, the agency emphasised the need for additional analysis and comments from the public to assess whether the proposal aligns with standards to prevent fraudulent and manipulative acts.
Key areas highlighted by the SEC for consideration include whether Ethereum and its proof-of-stake model present distinct concerns compared to Bitcoin, the susceptibility of Ethereum prices to manipulation, the significance of the CME Ethereum futures market as a regulated and sizable market, and the effectiveness of a planned surveillance-sharing agreement between Cboe and Coinbase.
Stakeholders are invited to submit comments during a 21-day period, followed by a subsequent 14-day period for rebuttals.
The SEC will scrutinize both the proposal and the comments received to make a determination on whether to approve or disapprove the listing of the Ethereum ETF.
This move comes after the SEC postponed its decision on the application in December 2023, allowing ample time for a thorough examination of the proposed rule change and associated concerns.
The delay in the decision-making process has impacted Invesco Galaxy’s spot Ethereum ETF, particularly due to Cboe’s association with the proposed collaboration between Invesco and Galaxy Digital.
Meanwhile, the securities regulator has also extended the deadline for the spot Ethereum ETF proposal from Grayscale, following previous extensions for applications from Fidelity and BlackRock.
Bloomberg senior ETF analyst James Seyffart reported that, beyond the Cboe application, the SEC is reviewing applications for spot Ether ETFs from various companies, including Hashdex, VanEck, Fidelity, and ARK 21Shares.
SEC just delayed @InvescoUS & @galaxyhq‘s #Ethereum ETF. 100% expected and more delays will continue to happen in coming months.
The only date that matters for spot #ethereum ETFs at this time is May 23rd. Which is @vaneck_us‘s final deadline date pic.twitter.com/gkVZL2QuPK
— James Seyffart (@JSeyff) February 6, 2024
Despite the delays, industry experts expect that the approval for spot Ether ETFs will come soon. Notably, the regulator recently approved the applications of ten spot Bitcoin exchange-traded funds (ETFs) after 11 years of rejections and delay.
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