Grayscale Has Once Again Pulled Its Application For Ethereum Futures ETF

Grayscale has once again withdrawn its application for an Ethereum Futures ETF, this time just over two weeks before the deadline for the SEC to decide on at least one spot Ether ETF application. 

Source: coingape.com

The surprise move came as Grayscale filed a notice to withdraw its 19b-4 application for the Grayscale Ethereum Futures Trust with the U.S. Securities and Exchange Commission on May 7. The SEC was slated to make a final decision on Grayscale's Ether futures ETF by May 30. Initially filed on September 19, 2023, Grayscale's 19b-4 application aimed to introduce an Ether futures ETF listed on the New York Stock Exchange, pending approval.

ETF analyst James Seyffart had previously speculated that Grayscale might strategically leverage its Ether futures ETF as a trojan horse to pressure the SEC into greenlighting its spot Ether ETF. However, Seyffart expressed bewilderment at Grayscale's decision to withdraw now, given that the SEC must decide on at least one spot Ether ETF application by May 23, just over two weeks away. For several months, both Seyffart and fellow Bloomberg ETF analyst Eric Balchunas have assessed the probability of spot Ether ETF approval on May 23 at 25%, a significant drop from the 70% estimation in January.

However, recent remarks from SEC Chair Gary Gensler during a May 7 CNBC interview indicate that the SEC is still deliberating its stance on spot Ether ETFs. The SEC faces a deadline to decide on VanEck's application by May 23, with ARK 21Shares and Hashdex following suit with final deadlines on May 24 and May 30, respectively. Subsequent applications from Grayscale, Invesco Galaxy, BlackRock, and Fidelity are slated for submission in June, July, and August. Nonetheless, many industry observers anticipate the SEC to render decisions on all or most applicants in a manner akin to its approach with spot Bitcoin ETFs in January.

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