SEC issues comment notices on Grayscale, Hashdex, and Pando crypto ETFs

Dec. 18, 2023

By Mike Dalton

The U.S. Securities and Exchange Commission (SEC) has initiated additional proceedings regarding three proposed crypto exchange-traded funds (ETFs), effectively delaying their approval, as announced in notices published on Dec. 18. These proceedings concern NYSE Arca’s proposed rule change for Grayscale’s Ethereum Futures Trust ETF and Nasdaq’s proposal for Hashdex’s spot Ethereum ETF.

Initially, on Nov. 15, the SEC extended its review period for these proposals, and now, with the new proceedings, the decision on each ETF is postponed further. According to the notices, stakeholders must submit initial and rebuttal comments within 21 and 35 days, respectively, after the notices’ publication in the federal register, indicating a decision is at least 35 days away.

SEC asks about Ethereum features and more

In both filings, the SEC asked whether Ethereum’s unique features, including proof-of-stake consensus, raise concerns regarding manipulation and fraud not seen in Bitcoin futures ETFs. The agency asked more broadly about vulnerability to fraud and manipulation and each ETF proposal’s ability to reduce this risk.

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