Earlier this week, the US Securities and Exchange Commission (SEC) delayed its decision on multiple applications for Ethereum exchange-traded funds (ETFs).
This prompted companies like BlackRock and Grayscale to file amendments to their respective applications for a spot Ethereum ETF.
BlackRock filing
Investment giant BlackRock updated its filing to introduce a proposed rule change in its plan for listing and trading shares of its iShares Ethereum Trust.
Instead of in-kind redemptions and creations, it would switch to a cash-based model, which means authorized participants would create and redeem shares only with the use of cash.
In addition, it stated that authorized participants would not buy, hold, receive, or deliver Ethereum, either directly or indirectly, as part of the redemption or creation process.
This update mirrors the structure that was already outlined in some of the other Ethereum ETF applications that have been submitted.
Moreover, the same structure has also been used for spot Bitcoin ETFs, which have already been approved by the SEC.
Grayscale filing
Meanwhile, the filing from Grayscale is a bit different, as the company wants to convert its existing Ethereum Trust into a spot Ethereum ETF.
This is something that the company did in the case of its Bitcoin Trust as well, which has now been converted into a spot Bitcoin ETF.
Therefore, Grayscale did not need to file a Form S-1 and could directly file a Form S-3, as the asset manager’s Grayscale Ethereum Trust is already registered with the securities regulator.
The proposed Grayscale Ethereum ETF would trade under the ticker ETHE and its shares would be listed on NYSE Arca.
A Form S-1 registration document was also filed by Grayscale for a mini Ethereum ETF that would also be listed on the NYSE Arca and would trade under the ticker ETH.
The company had already proposed a mini Bitcoin ETF that would have reduced fees as compared to its flagship GBTC product, with the latter recording outflows worth billions of dollars since its launch.
The SEC
These filings come after the SEC announced that it was delaying its decision on the proposals of a spot Ethereum ETF submitted by Wall Street giant Franklin Templeton and Grayscale Investments.
In January, the regulator had reluctantly approved for spot Bitcoin ETFs and there had been hopes it would also do the same with spot Ethereum ETFs.
However, optimism has dwindled because the SEC has delayed its decision repeatedly when it comes to spot Ethereum ETF applications.
Investment bank JP Morgan had predicted earlier this month that there was only a 50% chance of the SEC approving a spot Ethereum ETF by May.
Meanwhile, Bloomberg Intelligence asserted that there was only a 25% chance of spot Ethereum ETFs getting approved by the deadline on May 23rd.
After the filings submitted by BlackRock and Grayscale, James Seyffar, a Bloomberg ETF analyst, said that it was clear that issuers were not ready to give up the fight, despite the delays from the SEC.