ARK Takes the Lead: Will Ethereum Spot ETF Filing Trigger a Chain Reaction?
In a filing with the SEC, ARK announced its intention to launch a financial product on the Cboe BZX Exchange that will track the price of ETH on the spot market. The price will be determined by the Chicago Mercantile Exchange (CME). Benchmarks will serve as the index manager, and 21Shares will sponsor the product.
Similar to its Bitcoin spot ETF application, ARK has chosen Coinbase as the custodian for its ETH holdings. The entire amount of ETH will be held by Coinbase on behalf of ARK.
The SEC has stressed the significance of the custodian when considering a Bitcoin ETF approval. Therefore, it is logical to assume that the same requirements will apply to an ETH spot ETF. ARK stated in its application that:
After thorough investigation, we believe that the custodian’s policies and procedures for safeguarding the Trust’s ether holdings are in line with industry best practices. The custodian is a third-party limited purpose trust company that obtained a trust charter from the New York Department of Financial Services in 2018.
Experts Eric Balchunas and James Seyffart from Bloomberg Intelligence have been closely monitoring crypto ETF applications in the US. They are optimistic about the SEC approving a Bitcoin spot ETF.
Based on this development, the experts anticipate that more hedge funds and asset managers will file for their own ETH spot ETF applications in the near future. Seyffart mentioned on social media:
Here we go… expect more spot #ethereum ETF filings in the coming days. NOTE: this is an S-1 and not a 19b-4. Which means it does not start a clock in any way… yet. Expect 19b-4’s soon.
Hot Take:
As of now, ETH is trading at $1,620, showing sideways movement over the past few days.
Cover image from Unsplash, chart from Tradingview
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