SEC Extends Review for Templeton Ethereum ETF

SEC has postponed its decision on Franklin Templeton’s Ethereum-based ETF until June 11, 2024 to further study the proposal.

The Securities and Exchange Commission of the United States has decided to delay its judgment about the approval of Franklin Templeton’s exchange-traded fund (ETF) that operates on the spot Ethereum market.

The next prolongation of the determination made by the commission is scheduled to take place on June 11, 2024. Over the course of the past few months, the Securities and Exchange Commission has implemented a number of postponements on numerous cryptocurrency exchange-traded fund (ETF) proposals.

Franklin Templeton Ethereum ETF Delayed By SEC

In February 2024, Franklin Templeton submitted the initial submission of the S-1 registration statement for the Franklin Ethereum Exchange-Traded Fund (ETF).

Coinbase Custody Trust Company and the Bank of New York Mellon have been appointed as their respective custodians for the exchange-traded fund (ETF), which is designed to follow the price of Ethereum.

The Securities and Exchange Commission has decided to postpone its decision because it needs further time to study the proposed rule modifications and any potential problems that may result from them.

According to the Securities and Exchange Commission, the extension would make it possible for the agency 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 Securities and Exchange Commission has not only delayed Franklin Templeton’s exchange-traded fund (ETF) application. The Securities and Exchange Commission (SEC) has also delayed other Ethereum ETF applications, including those from financial heavyweights VanEck and BlackRock.

The Securities and Exchange Commission (SEC) has taken a cautious position on exchange-traded funds (ETFs) that are based on cryptocurrencies. Cryptocurrency-based ETFs are relatively new financial instruments that have a great deal of complexity in terms of regulation.

A significant number of these exchange-traded fund (ETF) ideas have been made available for public discussion, with the primary concern being Ethereum’s proof-of-stake method, the potential for fraud and the ability for manipulation.

These delays, on the other hand, are seen during a time when the hope of being granted permission to hold a position in the Ethereum ETF has been showing signs of diminishing.

Market Impact and Prospects

Analysts, including those at JPMorgan, have noted a decline in the expected probability of granting permission for such exchange-traded funds (ETFs) in the near future.

For instance, industry experts initially estimated the approval probability for May to be 70%, but they have since adjusted it to approximately 30%. Nevertheless, in spite of these obstacles, the effect of spot Bitcoin exchange-traded funds (ETFs) was a positive one in the market.

This suggests that the approval of Ethereum ETFs might similarly have a good impact on the cryptocurrency market. Despite the implemented decision, the price of Ethereum (ETH) has remained optimistic.

At the time of publication, the price of ETH stood at $3,234, indicating a 1.52% rise from the intra-day low.