Exit on the eve of SEC decision! Grayscale abandons Ethereum futures ETF plan

As the U.S. Securities and Exchange Commission (SEC) is about to make a decision, Grayscale surprisingly announced the withdrawal of its application for an Ethereum (ETH) ETF, a move that has the cryptocurrency community. There was a lot of discussion among the group.

Grayscale Grayscale strategic withdrawal?

The proposal submitted by Grayscale on September 19, 2023, originally aimed to list the Grayscale Ethereum Futures Trust on the New York Stock Exchange. However, on May 7, the crypto asset manager chose to withdraw its application, a decision that surprised many. Bloomberg ETF analyst James Seyffart, who had previously speculated that Grayscale might use futures ETFs as strategic leverage to push for approval of its ETH spot ETF, expressed confusion about the timing of the withdrawal.

SEC’s upcoming decision raises concerns

The SEC is currently facing pressure from a series of critical deadlines. Notably, the committee has until May 23 to decide on VanEck’s spot ETH ETF application, followed by deadlines for ARK 21Shares and Hashdex on May 24 and May 30, respectively. Applications from prominent companies such as Invesco Galaxy, BlackRock and Fidelity are also scheduled to be decided during the summer months of June, July and August.

Market analysts weigh in

Bloomberg ETF analyst James Seyffart and his colleague Eric Balchunas initially gave the spot Ether ETF a 70% chance of approval in January, but that number has since dropped to 25%.

This decline in confidence represents growing uncertainty about the SEC’s stance on cryptocurrency-related products. In an interview with CNBC on May 7, SEC Chairman Gary Gensler highlighted the ongoing discussions within the commission, saying: "This is an issue currently facing our commission, we are a five-member commission, and these applications will be processed in due course." .”

The cryptocurrency market is watching these developments closely, as the SEC’s decision could have a significant impact on the adoption and integration of cryptocurrencies into mainstream financial products. As industry experts speculate whether the SEC will handle these applications as it has previously done with spot Bitcoin ETFs, the community has not given up hope.

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