The United States Securities and Exchange Commission (SEC) has extended its review period for Fidelity’s Ether exchange-traded funds (ETFs) by 45 days.
This decision comes as the SEC seeks additional time to thoroughly assess the proposed rule change and address associated concerns.
Consequently, the new deadline for a decision has been scheduled for March 5, 2024.
In response to this development, James Seyffart, an ETF analyst at Bloomberg, expressed minimal surprise regarding the delay.
He took to Twitter on January 18 to suggest that the most critical dates to monitor might be later in May.
This notion stems from the SEC’s final deadline of May 23 for its decision on VanEck’s Ether ETF. Seyffart and some industry analysts speculate that the SEC could potentially approve multiple spot Ether ETFs concurrently, similar to its approach with spot Bitcoin ETFs.
Meanwhile, the competition in the ETF space is heating up, with Direxion filing for five Bitcoin ETFs with the SEC on January 18.
Other competitors, including ProShares and REX Shares, have also entered the arena. ProShares submitted five leveraged Bitcoin-tracking ETFs on January 16, while REX Shares filed for six leveraged Bitcoin ETFs on January 3.
Direxion’s filing outlines plans for 1x, 1.5x, and 2x long leveraged Bitcoin funds, along with corresponding short leveraged funds.
Eric Balchunas, an ETF analyst at Bloomberg, remarked on Twitter that the proliferation of leveraged Bitcoin ETFs may soon surpass that of long-only ones, a development unprecedented in the industry.
Balchunas is cautiously optimistic, assigning a 70% likelihood of approval by May, taking into account the SEC’s final deadline for VanEck’s fund.
However, Mark Yusko, the Co-Founder and CEO of Morgan Creek Capital, adopts a more conservative stance.
He suggests that the SEC maintains a somewhat unfriendly stance towards cryptocurrencies and raises the possibility of Ether being classified as a security, in contrast to Bitcoin, which SEC Chair Gary Gensler has previously designated as a commodity.