SEC Extends Deadline for Approving Fidelity Spot Ethereum ETF to March

SEC Extends Deadline for Approving Fidelity Spot Ethereum ETF to March

In an advanced communication, the prominent investment manager, Fidelity, confirmed that the US Securities and Exchange Commission (SEC) extended the deadline for the spot Ethereum exchange-traded fund (ETF) approval. News concerning the deadline extension was disclosed in a January 18 SEC filing.

The report stated that SEC rescheduled the approval of Fidelity’s spot Ethereum ETF to March. The market regulators claimed that the delays emanated from the complex regulatory structure that requires the SEC  to enforce new regulations.

SEC Set to Enforce New Rules

The proposed rules forced market regulators to delay the approval of Fidelity Ether ETF to ensure compliance. But before the set days, the SEC will engage in intense discussion concerning the proposed rules and consider public comment during the imminent rule-making process.

However, based on the risk associated with financial assets, the Fidelity team has been looking for new viable business opportunities. In November last year, the Fidelity team submitted the spot Ethereum ETF to the SEC to boost the accessibility of different asset types.

The primary objective of the application was to offer Fidelity users an opportunity to tap the benefits of spot Ethereum ETF even without investing in the buying and selling of ETH. Guided by the existing rule-making process, the SEC commenced the review process for the Fidelity application.

SEC Extend Resolution of Fidelity Ethereum ETF 

In the subsequent review stage, the SEC allowed the public to provide feedback concerning Fidelity’s Ethereum ETF. During the resolution process, the SEC changed its mind on approving the spot Ethereum ETF.

Instead of approving Fidelity’s application, the market regulators extended the deadline by 45 days. This implies that the SEC is expected to issue its final decision regarding the Ethereum ETF in March.

The unexpected delays in the approval of the Fidelity application ignited heated debates among the crypto die-hards. On X, the renowned ETF analyst at Bloomberg Intelligence, James Seyffart, projected that the SEC will approve the spot Ethereum ETF on March 5.

The analyst regretted that the regulators might extend the deadline to May based on the current development in the crypto industry. Seyffart admitted that he expected the delays for the approval of the Ethereum ETF.

Industry Leaders Urge SEC to Ethereum ETFs 

On the contrary, Seyffart’s closest ally, Eric Balchunas, expressed optimism about the approval of Ethereum ETF. In his report, Balchunas envisaged the probability of the SEC approving the Ethereum ETF early this month to be 70%.

He projects that the SEC will approve the Ethereum ETF before May 2024. In an on-air interview with Rug Radio, the executive revisited the Grayscale case that exposed the SEC to several legal charges.

The delays in observing the Grayscale Bitcoin Fund forced  the SEC to thoroughly revise the application  as per the court orders. At the interview, Balchunas urged the SEC to take immediate action and approve the Ether ETF.

In the latter, the executive stated that failure to approve the pending spot Ether ETF would expose the SEC to other legal actions. Reportedly the SEC has been reluctant to approve the Bitcoin ETFs for nearly a decade to prevent manipulative practices.

Guided by the existing consumer protection rights, the SEC demanded that Bitcoin ETF hopefuls demonstrate effective strategies to safeguard consumers from fraud and exploitative business practices. Earlier last week, the SEC ended the war with the asset managers by approving the pending spot Bitcoin ETFs.

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