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Grayscale’s Ether Futures ETF Application Pulled, Reason Not Disclosed

Summary:
A proposal to list and trade shares of prominent asset manager Grayscale’s Ether futures exchange-traded fund (ETF) has been withdrawn, as per a new document filed on Tuesday. The filing by the US Securities and Exchange Commission (SEC) revealed that the application for the Grayscale Ethereum Futures Trust ETF, filed by NYSE Arca, Inc. in September last year, was withdrawn on May 3. Previously, the agency had delayed consideration of Grayscale’s ether futures ETF, with the most recent postponement occurring in March. However, the SEC had approved a batch of ether futures ETFs in October 2023, including those from ProShares, VanEck, and Bitwise. Bloomberg ETF analyst James Seyffart was the first to point out the development. Initially, Seyffart believed that Grayscale had

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A proposal to list and trade shares of prominent asset manager Grayscale’s Ether futures exchange-traded fund (ETF) has been withdrawn, as per a new document filed on Tuesday.

The filing by the US Securities and Exchange Commission (SEC) revealed that the application for the Grayscale Ethereum Futures Trust ETF, filed by NYSE Arca, Inc. in September last year, was withdrawn on May 3.

Previously, the agency had delayed consideration of Grayscale’s ether futures ETF, with the most recent postponement occurring in March.

However, the SEC had approved a batch of ether futures ETFs in October 2023, including those from ProShares, VanEck, and Bitwise.

Bloomberg ETF analyst James Seyffart was the first to point out the development. Initially, Seyffart believed that Grayscale had a strategic plan to use its ether futures ETF to influence the securities regulator into approving its spot ETH ETF.

He found it puzzling that Grayscale withdrew its application, particularly with the SEC scheduled to decide on at least one spot ether ETF application on May 23, just over two weeks away.

Seyffart, along with fellow analyst Eric Balchunas, had previously estimated a 25% chance of approval for spot ether ETFs in May, a decrease from 70% in January.

Even with Grayscale’s withdrawal, Seyffart now sees the company as having no alternatives if the SEC doesn’t approve its spot ether ETF.

“If you don’t want to piss off the SEC. Withdrawing and re-filing is less work for the SEC. But at same time it means there’s no way for Grayscale or anyone to sue now.”

However, comments from SEC Chair Gary Gensler in a May 7 CNBC interview suggest that the SEC is still deliberating on spot Ether ETF applications.

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