SEC delays BlackRock’s spot Ethereum ETF; decisions are still due in May

The U.S. Securities and Exchange Commission (SEC) extended the decision period on BlackRock’s planned spot Ethereum ETF on Jan. 24.

That notice concerns a proposed rule change allowing Nasdaq to list and trade shares of the BlackRock iShares Ethereum Trust.

Previously, the SEC was required to approve, reject, or institute proceedings to approve or reject BlackRock’s proposal by Jan. 25, 2024. However, securities laws permit the agency to extend the decision period to March 10, 2024.

The SEC noted Nasdaq initially filed the proposed rule change on Nov. 21, 2023 and that the proposal was published for comment in the Federal Register on Dec. 11, 2023. The date of publication determines the deadlines described above.

The SEC added that it has not received any comments on BlackRock’s spot Ethereum ETF proposal. By contrast, BlackRock’s spot Bitcoin ETF proposal received about 15 comments within two months of its June 2023 filing.

SEC still expected to make decision in May

The delay around BlackRock is not expected to affect broader Ethereum ETF proceedings. Bloomberg ETF analyst James Seyffart said today:

“Spot Ethereum ETF Delays will continue to happen sporadically over the next few months. [The] next date that matters is May 23rd.”

May 23 is relevant as the SEC must approve or deny VanEck’s spot Ethereum ETF by that date without any possibility of further delays. The securities regulator will likely decide on other similar applications with different deadlines, including BlackRock’s, alongside VanEck’s application at that time.

The SEC similarly delayed proceedings around Fidelity’s spot Ethereum ETF this month. Once again, this will not impact the May decision deadline.

Though it is required to make a decision by May 23, it is unclear whether the SEC will opt to approve the funds. FOX Business’ Eleanor Terrett has reported internal resistance at the SEC while suggesting that some ETF issuers are optimistic.

Polymarket odds currently suggest a 54% chance of approval by May 31. Bloomberg ETF analyst Eric Balchunas predicts a 70% chance of approval.