- Major financial entities like BlackRock, Grayscale, and Fidelity have submitted proposals for Ethereum ETFs to the SEC.
- The approval of Ethereum ETFs could integrate Ethereum into mainstream U.S. investment channels alongside Bitcoin.
The SEC is currently evaluating several applications for Ethereum spot exchange-traded funds (ETFs), following the successful approval of various Bitcoin ETFs earlier in the year. These applications reflect a substantial interest from leading financial entities in offering a regulated means of investing in Ethereum, which ranks as the second-largest cryptocurrency by market capitalization.
An ETF is a marketable security that tracks a stock index, a commodity, bonds, or a bundle of assets like an index fund. Unlike mutual funds, ETFs trade on stock exchanges in the same way stocks do, changing in price throughout the trading day as they are bought and sold.
An Ethereum spot ETF would enable investors to purchase shares in a fund that directly holds Ethereum, thereby directly linking the value of the shares to the market price of Ethereum without the need for the investors to manage the actual cryptocurrency.
The following summarizes the key organizations that have submitted Ethereum ETF proposals to the SEC:
- BlackRock: This major asset management firm submitted an S-1 form for its proposed iShares Ethereum Trust in November. The SEC has deferred its decision on this product until August 7.
- Grayscale: A leader in cryptocurrency funds, Grayscale has requested approval to transform its existing Ethereum trust into a spot ETF. This follows its earlier success in converting a Bitcoin trust into an ETF. The SEC is slated to render a decision by June 18.
- Ark Invest/21Shares: Ark Invest, under the leadership of Cathie Wood, in partnership with 21Shares, has applied for an Ethereum ETF, naming Coinbase as its custodian. The SEC’s deadline to decide on this application is May 24.
- Fidelity: This financial services firm is seeking approval for its Fidelity Ethereum Fund, with the SEC’s decision expected on August 3.
- VanEck: Having previously introduced a Bitcoin ETF, VanEck has reapplied for an Ethereum ETF, with an SEC decision due on May 23.
- Hashdex: This Brazilian fund manager, in collaboration with Nasdaq, has proposed an Ethereum ETF, with the SEC’s decision anticipated on May 30.
- Franklin Templeton: This financial heavyweight is exploring the inclusion of staking in its Ethereum ETF strategy. The SEC will decide on this proposal on June 11.
- Invesco/Galaxy Digital: Invesco, in partnership with Galaxy Digital, has lodged a proposal, expecting an SEC decision on July 7.
- Bitwise: Known for its crypto-focused index funds, Bitwise has filed for an Ethereum ETF, possibly incorporating staking to enhance investor returns.
These applications indicate a significant interest in establishing regulated investment vehicles for Ethereum, akin to the prior enthusiasm for Bitcoin ETFs. The decisions by the SEC in the coming months could substantially impact the U.S. cryptocurrency investment sector by potentially integrating Ethereum into mainstream investment channels through ETFs.
