The United States Securities and Exchange Commission (SEC) will again delay its decision on the application for options trading on BlackRock's Ethereum-based ETF. The decision is expected to be heard on April 25.
SEC Decision Delay
BlackRock’s iShares ETH Trust was among the first eight spot ETH ETFs approved by the SEC that began trading in July. The Nasdaq ISE exchange applied for a rule change to allow options trading on the trust in the same month. Published in the Federal Register on August 12, the agency had 180 days (until Feb. 8) to make its decision but has delayed it by up to 60 days, until April 25, to thoroughly consider the proposed rule change and related issues.
Objections to ETH ETF Options Trading
The agency received two comments on the proposal in December. In one letter, a representative of Better Markets, a nonprofit organization, expressed concern that the high volatility inherent in cryptocurrencies would lead to greater instability in traditional financial markets due to the higher volume of funds involved through the ETF. Better Markets also argued that an ETH ETF would be even more detrimental to the economy due to the substantial investments in the proof-of-stake consensus mechanism.
Growing Interest in ETH ETFs
There is widespread interest in ETH ETFs. The NYSE American exchange filed for a rule change to allow it to list and trade options on the Bitwise ETH ETF and other trusts a day after Nasdaq’s request regarding BlackRock. Additionally, the SEC released a filing requesting comment on Cboe BZX Exchange's request to list options trading on Fidelity’s ETH ETF, filed on February 3.
The SEC's delay in the decision on BlackRock Ethereum ETF options trading is intended to ensure a thorough review of all aspects and potential market impacts. Active discussions among industry participants reflect growing interest in the development of cryptocurrency ETFs.
