Grayscale Ethereum Trust Discount Narrows Amid ETF Approval Uncertainty

The Grayscale Ethereum Trust (GET) is making headlines once again as its discount narrows to -20%, a level not seen since November 2023. This development comes amidst growing uncertainty surrounding the potential approval of a spot Ethereum exchange-traded fund (ETF) in May.

GRAYSCALE ETHEREUM TRUST DISCOUNT HITS -20%

The discount on the Grayscale Ethereum Trust has decreased to -20%, marking its lowest level since November 2023. This decline in discount comes amid waning optimism for the approval of a spot Ethereum ETF by May. Traders' lack of… pic.twitter.com/IJrUuKZUVh

— Crypto Town Hall (@Crypto_TownHall) March 20, 2024

Investors, seemingly less optimistic about the ETF’s prospects, are adjusting their expectations accordingly.

The Securities and Exchange Commission (SEC) recently announced delays in its decisions regarding the Hashdex and Ark 21 Shares Ethereum spot ETFs, pushing the deadlines to May 30 and May 24, respectively.

The SEC cited the need for additional time to thoroughly assess the proposed rule changes and address any concerns raised.

The SEC has postponed decisions on the Hashdex and Ark 21 Shares Ethereum spot ETFs to May 30 and May 24, respectively. The SEC stated that it would be appropriate to specify a longer period for issuing an order approving or disapproving the proposed rule change to allow…

— Wu Blockchain (@WuBlockchain) March 20, 2024

Meanwhile, Fidelity’s spot ether ETF application has introduced a new feature: the option to stake cryptocurrencies. This addition could potentially generate income for the fund by allowing it to assign ether tokens as compensation to reliable staking providers. 

These providers, in turn, will stake a portion of the fund’s assets. Notably, this move aligns with the growing trend of cryptocurrency staking, with approximately $35 billion worth of Ethereum currently locked by Lido, one of the leading staking providers in the market.

FIDELITY AMENDS SPOT ETHER ETF APPLICATION TO INCLUDE STAKING PROVISIONS, LIDO PUMPS

Fidelity has updated its spot ether ETF application to allow for staking of the cryptocurrency, potentially generating income for the fund.

The amendment states that Fidelity may engage… pic.twitter.com/U81Vd4OHUx

— Crypto Town Hall (@Crypto_TownHall) March 20, 2024

As investors navigate the evolving landscape of Ethereum investment options, the narrowing discount on the Grayscale Ethereum Trust reflects their cautious optimism tempered by regulatory uncertainty.

While the potential for a spot Ethereum ETF approval remains uncertain, the market continues to adapt to new developments and explore innovative strategies to maximize returns on Ethereum investments.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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