Bloomberg analysts have significantly reduced the likelihood of a spot Ethereum exchange-traded fund (ETF) being approved by the U.S. Securities and Exchange Commission (SEC) by May.

The SEC’s silence and inaction have led analysts to reassess the chances of a spot Ethereum ETF approval, with Bloomberg Senior ETF Analyst Eric Balchunas now estimating a 30% probability, down from his January prediction of 70%.

The absence of typical pre-approval activities, such as filing changes and issuer engagement, has been a cause for concern among industry experts.

The revised estimates come as the SEC has not provided feedback or engaged with ETF issuers, which is typically part of the approval process.

The lack of movement and communication from the SEC has dampened the previously optimistic outlook for the approval of a spot Ethereum ETF, contrasting with the successful launch of spot Bitcoin ETFs.

The SEC’s stance on Ethereum as a security, as opposed to a commodity like Bitcoin, may influence its decision-making process. SEC Chair Gary Gensler’s previous political challenges following the approval of spot Bitcoin ETFs and a court loss to Grayscale in August 2023 could also be factors in the SEC’s current approach.

Ethereum traded at around US$3,970, at 3 p.m. ET, according to CoinGecko.