Ethereum enthusiasts were cruising down the information superhighway towards a July 4th fireworks celebration of a different kind: the launch of the first spot Ethereum ETF.
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Investor enthusiasm was dampened when the US Securities and Exchange Commission unexpectedly sent back applicants’ proposals, delaying the much-anticipated debut.
Missed Exit: Ethereum ETF July Launch Goes Up In Smoke
The news came as a shock to many, as market watchers and analysts alike had confidently predicted a July launch, with some even suggesting a celebratory trade on Independence Day.
Bloomberg ETF analysts Eric Balchunas and James Seyffart were among those waving the checkered flag a little too early. Their prediction of a July 2nd debut went up in smoke after the SEC decided to put the brakes on the process.
Unfort think we gonna have to push back our over/under till after holiday. Sounds like SEC took extra time to get back to ppl this wk (altho again very light tweaks) and from what I hear next wk is dead bc holiday = July 8th the process resumes and soon after that they’ll launch… https://t.co/0ZQR7yiBLt
— Eric Balchunas (@EricBalchunas) June 28, 2024
Insiders claim that the SEC has delayed the anticipated debut date by requesting changes to the S-1 paperwork that issuers have submitted. This unexpected diversion raises serious concerns about the schedule as a whole. Although there are others who anticipate clearance by July 8th, the impending US holiday probably adds another level of difficulty.
Uncharted Territory: The SEC Takes The Wheel
For issuers and investors alike, the absence of a clear timetable is a major source of discomfort. In contrast to the earlier 19b-4 forms, which required the SEC to make a decision within a certain amount of time, the S-1 filing process allows the regulatory body as much time as it needs. This essentially gives the SEC full control, enabling them to make changes requests and perform a comprehensive assessment without feeling pressed for time.
While SEC Chair Gary Gensler has previously hinted at approvals “sometime this summer,” his comments haven’t offered much solace to the jittery market. The recent snafu with the S-1 forms indicates that even a summer launch might be overly optimistic. This lack of clarity is a major hurdle for issuers and creates uncertainty for investors who are eager to jump on board the Ethereum ETF bandwagon.
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The Road Ahead
The SEC’s recent actions have thrown the timeline into disarray, leaving investors and issuers in a state of limbo. While approval might still happen sometime this summer, the lack of clarity paints a picture of a bumpy ride ahead for these highly anticipated investment vehicles.
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