The likelihood of the U.S. Securities and Exchange Commission (SEC) approving an Ethereum (ETH) spot Exchange-Traded Fund (ETF) has significantly decreased.

This is evidenced by market sentiment on platforms like Polymarket, where the approval odds dropped to 24%. 

Despite the crypto community's optimism earlier this year, recent developments indicate a growing skepticism about the SEC's approval of Ethereum ETFs, particularly in the lead-up to the anticipated decision date of May 23.

Diminishing optimism 

Eleanor Terrett, a reporter at Fox Business, has noted that there has been a significant change in mood regarding the SEC's stance on Ethereum ETFs. 

Insiders suggest that the SEC, under Chairman Gary Gensler, is less engaged in discussions about Ethereum ETFs compared to their Bitcoin counterparts, hinting at a possible contentment with the progress made with Bitcoin ETF approvals. 

Additionally, political pressure from figures like Senator Elizabeth Warren, who have expressed dissatisfaction with the SEC's approval of Bitcoin ETFs, seems to be influencing the regulator's approach toward Ethereum products. 

Regulatory delays 

The SEC has recently postponed its decision on various Ethereum ETF proposals, including those from financial giants BlackRock and Fidelity. This has set the stage for further uncertainty despite the fact that such an outcome was expected by market analysts. 

This delay signals a cautious approach from the SEC, mirroring its previous hesitance with Bitcoin ETFs. 

As reported by U.Today, Eric Balchunas, a senior analyst at Bloomberg, has tempered expectations for Ether ETFs, likening them to an opening act following a headliner. Jake Chervinsky, Variant's chief legal officer, speculated the SEC's cautious approach is influenced by political resistance and market volatility. 

Despite this, the crypto industry remains hopeful, looking for signs of potential approval in the regulator's future actions and commentary.