The Securities and Exchange Commission (SEC) has extended the comment period on a proposed rule change that would allow NYSE Arca to list and trade shares of the Grayscale Ethereum Trust as an exchange-traded fund (ETF). The extension gives the SEC more time to consider the implications of the rule change, with a decision now expected in January 2024. The proposed rule change would enable the Grayscale Ethereum Trust, a $5 billion institutional investment vehicle for Ether, to convert into a spot ETF. This conversion could provide more liquidity and potentially eliminate the discount at which the trust has historically traded compared to the net asset value of its underlying Ether holdings. Grayscale sees the conversion to an ETF as the natural next step for the product, bringing Ethereum further into the regulated financial system. However, the SEC has yet to approve a spot crypto ETF in the U.S., having delayed decisions on Bitcoin ETF applications earlier this year. Other major financial institutions, such as Fidelity and BlackRock, have also filed proposals for spot Ethereum ETFs, and the SEC has opened a comment period to gather public feedback on Fidelity’s filing. The SEC’s cautious stance reflects concerns about market manipulation risks, surveillance mechanisms, custodial qualifications, and other factors related to the crypto asset class. The decision on the Grayscale Ethereum Trust is eagerly anticipated, as it could pave the way for accessible and regulated crypto investment vehicles in the U.S. markets.

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Information	Details
Geography	Global
Countries
Sentiment	neutral
Relevance Score	1
People	None
Companies	Fidelity, NYSE Arca, BlackRock, SEC, Grayscale
Currencies	Lido Staked Ether
Securities	None