The U.S. Securities and Exchange Commission (SEC) has once again postponed critical decisions on Ethereum (ETH) exchange-traded funds (ETFs), casting a shadow over investor sentiment in the crypto market.
The regulatory body extended the deadline to June 1 for reviewing the staking provisions on two Grayscale spot ETH ETF filings. These applications, submitted in February, propose allowing staked ETH to generate passive income within the ETF structure.
Several other major issuers—including Bitwise, VanEck, 21Shares, Fidelity, Invesco Galaxy, and Franklin Templeton—have also filed for similar staking capabilities. Notably, BlackRock has yet to submit such an application. However, Robert Mitchnick, BlackRock’s head of digital assets, has previously acknowledged the value staking could bring to ETF offerings.
In parallel, the SEC also delayed decisions on in-kind creation and redemption mechanisms for both ETH and BTC ETFs, pushing the new deadline to June 3. Unlike the cash-based settlement model currently favored by SEC Chair Gary Gensler, in-kind redemption uses the actual underlying assets, thereby avoiding taxable events and improving liquidity for investors.
The SEC’s crypto-focused task force has reportedly conducted roundtable talks with key industry stakeholders—including Jito, MultiCoin Capital, and BlackRock—to evaluate the implications of both staking and in-kind methods.
Despite these developments, Ethereum’s market response has remained muted. Data from Coinglass reveals that Open Interest (OI) in ETH derivatives has dropped from nearly $26 billion in February to under $20 billion, reflecting waning speculative appetite.
Technically, ETH is navigating a bearish rising wedge pattern on the 4-hour chart. If confirmed, the formation could push the asset below $1,500. Conversely, a successful reclaim of the $1,800 level might empower bulls to regain short-term control.
As deadlines approach, the crypto community will be watching closely to see whether the SEC embraces more progressive ETF structures—or continues its cautious stance. Either way, market volatility seems poised to continue.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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