SEC Postpones Verdict on Fidelity’s Proposed Ethereum Spot ETF Until March

The Securities and Exchange Commission has extended the deadline for reaching a decision on Fidelity’s proposal for a spot Ethereum exchange-traded fund until March 5, as indicated in a filing on Thursday. 

“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,” the SEC stated.

The SEC noted the need for additional time to thoroughly evaluate the proposed rule change and related concerns. 

Fidelity submitted the proposal for the Fidelity Ethereum Fund in November, referencing a court ruling from the previous year that highlighted the SEC’s lack of a coherent rationale for rejecting spot crypto ETFs while allowing futures-based products. 

The SEC now has an extended timeframe to consider approval, disapproval, or further proceedings.

Bloomberg ETF analyst James Seyffart remarked today that the Fidelity delay was anticipated, emphasising the significance of late May deadlines. 

This deadline is linked to the SEC’s requirement to either approve or reject VanEck’s competing spot Ethereum ETF proposal by May 23. 

Since proceedings have already been initiated on VanEck’s application, the SEC cannot further postpone its decision. Typically, the SEC approves similar ETFs concurrently, suggesting that a decision on all pending spot Ethereum ETFs is likely in late May. 

Public expectations are divided, with a Polymarket prediction market currently indicating 54% odds favouring spot Ethereum ETF approvals.