Grayscale Investments Applies for Ethereum Futures ETF
Grayscale Investments has submitted an application to the U.S. Securities and Exchange Commission (SEC) for a new cryptocurrency exchange-traded fund (ETF). Unlike the numerous Bitcoin spot ETFs currently awaiting approval, this proposed ETF would be based on Ethereum futures.
The paperwork filed by Grayscale on Tuesday states that the fund will not transact in Ether or require an Ether custodian. Instead, it will exclusively deal with futures contracts.
Grayscale’s decision to pursue an Ethereum futures ETF follows its recent legal victory against the SEC. A federal judge overturned the regulator’s decision to block Grayscale from converting its Bitcoin trust into a spot ETF.
While waiting for approval on its Bitcoin ETF, Grayscale hopes that its Ethereum futures ETF will be given the green light by the SEC.
The Appeal of Crypto ETFs
The SEC approved the first Bitcoin futures ETF in 2021, allowing investors to speculate on future cryptocurrency prices without directly owning digital assets. However, there is still significant demand for spot crypto ETFs.
The SEC is currently reviewing several applications for spot crypto ETFs, including one from BlackRock, the world’s largest asset manager.
A crypto ETF would offer traditional investors a safer way to gain exposure to cryptocurrencies. By investing in shares that track the price of an underlying asset, investors can participate in the market without having to worry about storing and securing their own crypto holdings.
Hot Take: The Future of Crypto ETFs
The filing of Grayscale’s application for an Ethereum futures ETF indicates growing interest in expanding the range of cryptocurrency investment options available to traditional investors. While Bitcoin futures ETFs have already been approved, there is still a strong desire for spot crypto ETFs.
If approved, an Ethereum futures ETF would provide another avenue for investors to enter the crypto market and potentially benefit from the price movements of the second-largest cryptocurrency by market capitalization.
As the SEC continues to review applications for various crypto ETFs, it remains to be seen whether spot ETFs will eventually receive regulatory approval. Nevertheless, the interest and demand for these investment vehicles demonstrate the increasing mainstream acceptance and integration of cryptocurrencies into traditional financial markets.
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