Bloomberg ETF analyst James Seyffart thinks the U.S. Securities and Exchange Commission will likely reject a spot ETH ETF on May 23, marking a change from earlier optimism in recent months. May 23 is the final deadline for the SEC to make a decision on the first ETH ETF to file for approval. 

According to Seyffart and his Bloomberg colleague Eric Balchunas, the likelihood of the SEC’s approval hinges on whether potential spot ETH ETF issuers report having contact with the SEC, but so far, there has been no such outreach.

Read more: Senators Call on SEC’s Gary Gensler to Cool It on Approving More Crypto ETFs

“We haven’t seen signs of SEC engagement with the issuers on this topic and we would have expected to see more substantial signs of interactions between the SEC and these issuers by now if the SEC were planning to approve,” wrote Seyffart in an email to Unchained. “Until issuers say the SEC’s reached out, approval shall remain in serious doubt,” Balchunas said on X. 

Falling Odds

Last week, Balchunas reduced his estimate of the likelihood of the SEC approving a spot ETH ETF on May 23 to 35%, down from as high as 70% in January. Two weeks ago, speaking on an episode of the Unchained podcast, Balchunas put the odds of approval at 50%.

The prediction change from the Bloomberg analysts comes as the SEC filed notices on Tuesday to delay its decision to approve two spot ETH ETFs: the Hashdex Nasdaq Ethereum ETF and the ARK 21Shares Ethereum ETF

“The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised,” the filing about the Hashdex Nasdaq Ethereum ETF stated. The SEC designated May 30 as the deadline for its decision for the Hashdex Nasdaq Ethereum ETF.

ETH, the native currency for the Ethereum blockchain, has decreased nearly 7% in the past 24 hours and about 17% in the past seven days to trade around $3,290, data from CoinGecko shows.