Ark Invest and 21Shares Alter Ethereum ETF Filing
Ark Invest and 21Shares revised their Ethereum ETF filing, changing it to a cash-only create and redemption mechanism.
Market Response to Filing Amendment
The amended filing led to a slight boost for Ether, with the cryptocurrency up 2.7% in the last 24 hours, trading at $2,427 as of 07:05 EST.
SEC’s Preference for Cash Models
The SEC showing a preference for cash models is evident in the approved filings for spot Bitcoin ETFs last month.
If the Ether ETF is approved, ARK 21Shares will need to buy ETH equivalent to the order amount before depositing it into the trust’s account with a custodian.
Introduction of Staking
21Shares included provisions for staking Ether using at least one trusted third-party staking provider. This has generated excitement in the crypto community, with some saying the offering will appeal to the traditional finance sector.
Risks Associated with Staking
Despite the announced staking provisions, ARK 21Shares indicated potential risks associated with staking activities, including potential losses and assets being locked up for an extended period of time.
Hot Take: Assessing the Implications of the Ethereum ETF Filing Amendment
The decision to alter the Ethereum ETF filing to a cash-only creation and redemption mechanism could significantly impact the way investors engage with the cryptocurrency. With the amended filing and added provisions for staking activities, the revised ETF presents new opportunities for both crypto enthusiasts and traditional investors alike. However, careful consideration of the risks associated with staking will be crucial for informed investment decisions.
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