Updated from 2:02 p.m. EST

The proposed silver exchange-traded fund took a step toward public trading -- and silver prices had another big spike -- after the Securities and Exchange Commission approved a rule change allowing the fund to be listed on the Amex. Nevertheless, it's still too early to say "Hi Ho" to a silver ETF just yet.

Silver prices, which were already hovering at record highs in anticipation of the release of a silver ETF, jumped on the news of the Amex listing approval Tuesday. Silver for May delivery at the Comex division of the New York Mercantile Exchange was recently up 17 cents to $10.55 an ounce, the highest price since 1983.

Nevertheless, while today's ruling gives the silver ETF a place to trade, it doesn't mean it is cleared for takeoff.

"The S-1, which is the registration statement submitted by BGI, has not become effective yet with the SEC, so we are still in the quiet period of the registration and a launch date cannot be determined," says Christine Hudacko, spokeswoman for Barclays Global Investors, which is behind the creation of the silver ETF.

Officials at the SEC could also offer no further guidance on the potential launch date of the ETF. The SEC has, however, closed its public comment period on the fund.

"The Amex is glad to see the SEC make an important step toward making the iShares Sliver Trust available to the public, and we look forward to another BGI listing," says Cliff Weber, senior vice president of the ETF marketplace division of the American Stock Exchange.

BGI is applying to list 13 million shares backed by 129 million ounces of silver in a arrangement similar to the pair of existing gold ETFs, the StreetTracks Gold Trust ( GLD) and BGI's own iShares Comex Gold Trust ( IAU). Under this structure, the precious metal is tucked away in a vault while investors buy and sell shares that each represent about 10 ounces of silver.

Since 129 million ounces equates to roughly 16% of the world's annual silver production and 21% of the known above-ground inventories of silver, according to investment bank Salman Partners, the ETF potentially could drive up silver prices more than it has already, perhaps even squeezing the market. As a result, the ETF has come under attack by the Silver Users Association, a trade group that lobbies on behalf of silver producers and distributors. The group contests the proposed ETF, saying it "could make silver illiquid" and lead to manufacturing job losses.

Boutique investment bank Salman Partners recently raised its forecast for silver prices in 2007 to $11 an ounce from $7.75 on account of the new ETF's impending introduction, and the firm says prices could top $12 over the next two years. Shares of silver miners have steadily increased since mid-January, when the first signs of movement on the ETF were reported.