SEC Extends Decision Timeline on Fidelity's Ethereum ETF Proposal

The Securities and Exchange Commission (SEC) has opted to extend its decision-making deadline regarding Fidelity's proposal for a spot Ethereum exchange-traded fund (ETF) to March 5, as indicated in a filing on Thursday.

In the filing, the SEC stated, "The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein."

Fidelity had initially applied for the Fidelity Ethereum Fund in November, citing a court ruling from the previous year. The court had determined that the SEC lacked a clear rationale for rejecting spot crypto ETFs while permitting futures-based products.

This extension provides the SEC with additional time to deliberate on whether to approve, disapprove, or initiate proceedings. Bloomberg Intelligence ETF analyst James Seyffart commented on the delay, stating, "Fidelity #ethereum ETF delayed just now. Completely expected. Dates that really matter are late May in my view," in a post on X.

Notably, the SEC recently granted approval for 11 spot bitcoin ETFs to commence trading. This development has led some industry observers to speculate on the possibility of a spot Ethereum ETF being the next approval.

Fidelity had entered the competition for a spot Ethereum ETF alongside industry giant BlackRock in the latter part of the previous year. The applications for spot products were submitted a month before the launch of ether futures ETFs.

Stuart Barton, co-founder at Volatility Shares, noted last week, "The fact that they allowed listing of the futures based ETFs is enough to say they are thinking about ether the same way they are thinking about bitcoin, and you can infer from that they're probably thinking it's not a security and not going to regulate it that way."