SEC extends deadline for approving Ethereum spot ETFs due to staking issues

Markets are eagerly awaiting the US Securities and Exchange Commission's (SEC) verdict on Ethereum-backed spot ETFs. Tension is building among investors after the SEC recently extended its review of applications from ARK Invest and 21Shares. Although the regulator often takes such steps when evaluating new financial products, market anxiety continues to rise, according to CoinMarketCap experts.

Besides ARK Invest and 21Shares, the SEC is currently reviewing applications from VanEck, BlackRock, Fidelity, and Grayscale. The extended decision-making deadlines are prompting traders to reassess the likelihood of these applications being approved, CoinMarketCap adds.

The SEC typically requests more time to review proposals if it encounters complications or needs further clarification. For instance, to approve spot ETH ETFs, regulators must analyze the nuances of staking, which is the primary consensus mechanism used to validate transactions on the blockchain. In contrast, reviewing applications for similar Bitcoin-based funds did not pose such challenges for the commission, CoinMarketCap notes.