Ethereum ETF filings with SEC rise to six, heating up the market.
Ethereum ETF filings with SEC rise to six, heating up the market.
The Race To Launch An Ethereum Futures ETF
The blockchain industry continues to make strides in its quest for mainstream acceptance, with the latest development being the race to launch the first exchange-traded fund (ETF) tied to Ethereum futures. As traditional investors dive into the world of crypto, six companies have recently filed proposals with the Securities and Exchange Commission (SEC) to launch Ethereum futures ETFs.
Cryptocurrency ETFs, which track the price of digital currencies, have gained popularity in recent years. Bitcoin futures ETFs have already been established and are offered by popular investment companies. It is only natural for the next hot product to be an Ethereum futures ETF. While more than 10 Ethereum futures ETFs have been filed in the past, none have been approved by the SEC.
The first proposal for an Ethereum futures ETF was made by Volatility Shares Ether Strategy ETF on July 28. Since then, Bitwise Ethereum Strategy ETF, Roundhill Ether Strategy ETF, VanEck’s Ethereum Strategy ETF, and Proshares Short Ether Strategy ETF have followed suit and are awaiting clearance. Grayscale Investments, a digital currency asset management company, is also seeking to join the pack after withdrawing its initial filing due to SEC concerns. Bitwise also withdrew its previous filing at the same time.
According to the filing, the majority of Grayscale Investments’ fund assets would be placed in Ether futures contracts with “front-month” maturities, which have the shortest time to maturity. The company also intends to diversify into other Ethereum contracts in the future.
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Why Ethereum Futures ETFs Are Gaining Traction
The buzz around crypto ETFs was reignited by the news of BlackRock and other investment companies filing applications with the SEC for Spot Bitcoin ETFs. However, the SEC has not yet given the green light, citing failure to meet anti-fraud and investor protection standards in past applications.
Analysts believe that BlackRock’s Bitcoin ETF, if approved, could unlock $30 trillion worth of wealth. Nonetheless, there is no guarantee as to when or if the applications will be approved.
An Ethereum futures ETF would be a game changer for crypto investors and the industry as a whole. If approved, investors would gain access to Ethereum futures 75 days after the application date through these investment companies. This would provide an easy and low-cost way to gain exposure to the second-largest cryptocurrency by market capitalization.
While ETH’s spot price has struggled to break above $2,000 this year, currently trading at $1,843.96, the approval of these filings by the SEC could potentially trigger the beginning of the next Ethereum bull run.
In summary, the blockchain industry is witnessing a race among companies to launch the first Ethereum futures ETFs. This move further solidifies the integration of cryptocurrencies into the mainstream investment landscape. If approved, these ETFs would provide traditional investors with an accessible avenue to gain exposure to the potential upside of Ethereum. As the industry awaits the SEC’s decision, all eyes are on the potential impact on the market and the potential for an Ethereum bull run.
