Ethereum ETF impacted by SEC’s delayed decision – Here’s how

The SEC has delayed its decisions on BlackRock and Bitwise Ethereum ETF options until November.
Ethereum ETFs face $624.4 million in outflows, led by Grayscale’s Ether ETF.

As a seasoned crypto investor with years of experience navigating the ever-changing landscape of digital assets, I can’t help but feel a mix of anticipation and apprehension regarding the latest developments surrounding Ethereum ETFs. The ongoing delay in the SEC’s decision on BlackRock’s ETHA and Bitwise’s spot Ethereum ETFs is certainly cause for concern, especially considering the significant outflows these funds have been experiencing lately.

The deadline set by the U.S. Securities and Exchange Commission (SEC) for considering Nasdaq’s plan to offer ETHA trading, which is tied to BlackRock’s iShares Ethereum Trust, has been pushed back.

Blackrocks’ ETHA gets delayed

Originally planned to make a decision by the 26th of September, the SEC has now pushed back their final decision until the 10th of November instead.

On September 24th, the agency shared their reasoning for the delay: it wanted more time to assess how this listing might affect market stability and conduct a comprehensive examination of its effects on the larger financial system.

The press release added,

The Commission decides it’s better to allow more time before acting on the suggested rule adjustment, giving them ample opportunity to carefully examine the proposed change.

What’s behind this?

According to Section 19(b)(2) of the Securities Exchange Act, the Security and Exchange Commission (SEC) can postpone making a decision on certain proposals for as long as 90 days.

This add-on gives the regulatory body extra time to conduct comprehensive evaluations of potential market threats and stability, allowing them to make well-informed decisions in the end.

Through this action, the SEC guarantees a thorough examination of potential impacts the decision might have across the larger financial market.

Meanwhile, the U.S. Securities and Exchange Commission (SEC) has postponed its ruling on NYSE American’s application to list and trade options for Bitwise’s physically-backed Ethereum ETFs, such as the Grayscale Ethereum Trust and Grayscale Ethereum Mini Trust.

The deadline for this decision has been pushed to 11th November.

Blackrock’s IBIT gets a nod

In an unexpected turn of events, the Securities and Exchange Commission (SEC) has given its approval for Nasdaq to start trading options based on BlackRock’s exchange-traded fund that tracks the price of Bitcoin [BTC].

Starting on September 20th, the Securities and Exchange Commission (SEC) gave its approval for buying and selling bitcoin options through the iShares Bitcoin Trust. This financial instrument can be traded using the code name “IBIT”.

As reported by Nasdaq, these Bitcoin ETF options can be traded under the same terms and rules applicable to other ETF options. This move broadens the Bitcoin investment possibilities in the market.

Is Ethereum ETF performance to be blamed?

Since their debut, Ethereum Exchange Traded Funds (ETFs) have witnessed a substantial withdrawal of funds totaling approximately $624.4 million. This trend is primarily attributed to the Grayscale Ether ETF (ETHE), which has been the main contributor to this outflow.

In the past few weeks, there has been a significant increase in withdrawals, with the 23rd of September recording the highest net withdrawal since July, amounting to about $79 million being taken out.

Grayscale’s ETHE experienced a significant drop, with an impressive $80.6 million leaving the fund in just one day – the biggest daily outflow since Ethereum spot ETFs were introduced earlier this year.

Despite occasional inflows, the overall trend remains one of heavy withdrawals from these funds.

2024-09-26 04:40

Blackrocks’ ETHA gets delayed

What’s behind this?

Blackrock’s IBIT gets a nod

Is Ethereum ETF performance to be blamed?

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