The SEC Calls for Public Comment on Fidelity’s Proposed Ether ETF
The United States Securities and Exchange Commission (SEC) has requested public feedback on a proposed rule change that could allow asset management firm Fidelity to offer shares of its spot Ether (ETH) exchange-traded fund (ETF). The SEC notice stated that “interested persons” can comment on the Fidelity offering, which aims to list and trade shares of its Fidelity Ethereum Fund on the Cboe BZX Exchange. Fidelity filed for approval of the fund on November 17, joining several other firms vying for a spot crypto ETF in the US.
Fidelity Highlights Lack of US Regulated Ether ETP
The filing by Fidelity emphasized that investors in countries like Germany, Switzerland, and France already have access to Ether through regulated exchange-traded products. However, the US lacks a regulated vehicle for investors seeking exposure to Ether. The filing argued that this situation exposes US investors to significant risk as they are forced to seek alternative and riskier means of gaining exposure. Approving a spot Ether ETF would be a major win for investor protection in the crypto asset space.
SEC Yet to Approve Spot Crypto ETF Listings
Despite multiple applications from various firms over the years, the SEC has not approved any spot cryptocurrency exchange-traded products or funds for US markets. While Bitcoin futures ETFs were listed and traded starting in October 2021, and nine Ether futures ETFs were launched in October 2023, there has been no approval for spot Bitcoin or Ether investment vehicles. However, there are indications that the SEC may be nearing a decision on a spot crypto ETF, which would be a significant step toward mainstream crypto adoption.
Hot Take: Potential Implications of Approving a Spot Ether ETF
If the SEC approves a spot Ether ETF for listing on US markets, it would mark a significant milestone in the mainstream adoption of cryptocurrencies. The availability of a regulated vehicle for investors to gain exposure to Ether could attract more institutional and retail investors to the crypto market. This increased participation could lead to greater liquidity and stability in the Ether market. Additionally, it would provide US investors with a safer and more transparent way to invest in Ether, reducing their reliance on riskier alternatives. Overall, approving a spot Ether ETF would be a positive development for the crypto industry.
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