Grayscale has retracted its application for an Ethereum futures exchange-traded fund (ETF), known as 19b-4, just before the imminent decision deadline set by the Securities and Exchange Commission (SEC). The withdrawal notice for the Grayscale Ethereum Futures Trust was submitted on May 7.
Originally, Grayscale filed this ETF application on September 19, 2023, aiming for a listing on the New York Stock Exchange if approved. Bloomberg ETF analyst James Seyffart previously speculated that Grayscale might have intended to leverage this Ether futures ETF strategically to prompt the SEC’s approval for its spot Ether ETF. Nonetheless, he expressed confusion over the timing of Grayscale’s withdrawal, especially with the SEC set to decide on spot Ether ETF applications around May 23.
Seyffart and fellow analyst Eric Balchunas had lowered the likelihood of spot Ether ETF approval from 70% in January to 25% recently, prior to Grayscale’s withdrawal, which didn’t notably alter these odds. Seyffart pointed out that Grayscale’s withdrawal eliminates its option to pursue legal action should its spot Ether ETF application be denied.
SEC Chair Gary Gensler indicated in a May 7 CNBC interview that the commission is still deliberating on the spot Ether ETF applications, which include VanEck’s due on May 23, followed by ARK 21Shares and Hashdex on May 24 and May 30, respectively.
Further ETF applications from Grayscale, Invesco Galaxy, BlackRock, and Fidelity are slated for June, July, and August. Many experts anticipate that the SEC will address these applications collectively, as it did with spot Bitcoin ETFs in January.