First Companies Apply for Spot Ethereum ETF

A significant step in the crypto world was taken recently when Ark Invest, led by Cathie Wood, partnered with 21Shares to target the first Spot Ethereum ETF in the US.

Named the “ARK 21Shares Ethereum ETF,” this application stands out from previous applications for Spot Bitcoin ETFs, which were recently put on hold by the SEC. Just recently, the SEC expressed that it needed more consideration time for such applications after a triumph by Grayscale in court.

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Coinbase at the center of the action

In this innovative move, Ark Invest has designated Coinbase as the official custodian for the ETF. This implies that Coinbase would take responsibility for holding the Ethereum that serves as collateral for the ETF. Trading of this ETF would take place on the prestigious Cboe BZX Exchange.

A look at the ETF landscape so far

Although the SEC has already seen a flood of applications for futures-based Ethereum ETFs, Ark Invest’s latest push goes a step further. By comparison, futures-based bitcoin ETFs have been active on the NYSE since ProShares’ 2021 launch. Now, two years later, it seems only logical that Ethereum would make its grand entrance on Wall Street. There is speculation that the SEC could approve a number of Ethereum futures ETFs in the near future.

Despite some setbacks, such as the SEC’s delay of Ark Invest’s Spot Bitcoin ETF, hope remains. It’s worth noting that Ark Invest filed such an application back in June 2021.

Eric Baclhunas, a leading ETF analyst, has noted that in the past, the SEC has asked applicants of futures-based Ethereum ETFs to withdraw their applications shortly after filing. But now a change seems to be in the air. Baclhunas predicts that other financial giants will soon jump on the bandwagon and file similar applications. This suggests that the crypto industry continues to gain momentum.

A recent ruling by the U.S. Court of Appeals for the D.C. Circuit favored Grayscale, calling SEC criticism of Grayscale’s attempt to convert its Bitcoin trust into a spot ETF unfounded.

Conclusion

Recent developments show that cryptocurrencies are increasingly in the spotlight. It will be exciting to see how the SEC and other financial players react in the coming months.

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(Featured image by WorldSpectrum via Pixabay)

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