Ether spot ETFs are becoming as bullish as Bitcoin for investment managers.
ARK Invest, Cathie Wood’s asset management firm, filed for the first US Ether (ETH) spot ETF weeks after authorities halted its Bitcoin ETF application.
VanEck filed a similar 19b-4 application, starting the clock for regulators to approve or disapprove each filing.
Ark Ether ETF Pitch
The ARK21Shares Ethereum ETF will “track the performance of ether” by holding ETH to back its share value, according to an S-1 filed with the SEC on Wednesday.
The Trust would be held by Coinbase Custody, which services Grayscale and BlackRock. It also offered a surveillance sharing deal with Coinbase, like its Bitcoin spot ETF application.
The announcement briefly lifted Bitcoin (BTC) to $25,900 and ETH to $1655, but both assets swiftly recovered to their pre-announcement prices.
“Shareholders in the Trust will not benefit from the protections afforded investors in ether futures contracts on regulated futures markets,” the filing stated.
The SEC has a long record of favouring futures ETFs over spot ETFs when it comes to Bitcoin and has resisted approving a spot ETF. Gary Gensler, the agency’s chairman, has stated that the CME futures market offers investor protections unmatched by spot markets.
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The commission has not approved any Ether ETFs due to the asset’s higher price volatility and regulatory uncertainties than Bitcoin.
Recent developments, however, have prompted fund managers to deluge the SEC with Bitcoin spot ETF and Ether futures ETF applications. Some reports claim that the SEC’s approval of a leveraged Bitcoin futures ETF in June, which attracted strong Criticism from the cryptocurrency community, was what prompted the latter batch of applications.
When Is Ether ETF?
Bloomberg ETF analyst James Seyffart predicts the SEC will approve Ark and VanEck’s applications by May 23, 2024. That’s the same deadline as numerous Bitcoin spot ETF applications, March 15–19.
The SEC’s response to Grayscale’s spot Bitcoin ETF request following the firm’s legal defeat might have a significant impact on whether the application is approved. Grayscale emphasized to the agency in a recent letter that it no longer has justification to prefer futures Bitcoin ETFs over spot ETFs and that it should authorize such a product to benefit investors.