ARK Invest and 21Shares, a financial technology company, have revised their proposal for a spot Ethereum exchange-traded fund (ETF). They have removed the option to stake a portion of the fund's assets. The SEC is unlikely to approve spot Ethereum ETF applications, according to Eric Balchunas, a senior ETF analyst at Bloomberg.

ARK Invest and 21Shares submitted an updated registration statement to the SEC on May 10th. The proposal no longer includes the provision that allowed the issuer to stake a portion of the Trust's assets through third-party staking providers. This change has sparked speculation among industry observers. Eric Balchunas suggested that the removal might be an attempt to give the SEC one less reason to reject the application.

Despite these revisions, the odds of the SEC approving spot Ethereum ETF applications remain low. Balchunas stated that the lack of engagement from the SEC seems intentional rather than due to procrastination. He sees no positive signs that would suggest approval is likely.

The revisions to the ARK 21Shares Ethereum ETF application highlight the challenges faced by firms seeking to launch cryptocurrency ETFs in the U.S. With the SEC's cautious stance, the future of such financial products remains uncertain.