The SEC is poised to approve Ethereum futures ETFs, signaling a potential shift in regulation
The U.S. Securities and Exchange Commission (SEC) is preparing to give the green light to several exchange-traded funds (ETFs) that track Ethereum futures. This move suggests a change in the regulatory stance towards digital asset-based ETFs. Volatility Shares, an asset management firm, plans to launch its Ethereum futures ETF on October 12, potentially making it the first of its kind in the U.S. Similarly, Valkyrie, another prominent asset management entity, is eyeing an early October release for its BTC-Ethereum ETF.
Main breakdowns:
- Asset management firm Volatility Shares plans to debut an Ethereum futures ETF on October 12.
- Valkyrie is also planning to launch a BTC-Ethereum ETF in early October.
- The SEC has received over 16 ETF proposals for Ethereum and Bitcoin since July.
- The SEC’s approach to ETF applications has become more accommodating this year.
- ProShares’ Bitcoin futures ETF and Valkyrie’s similar product have seen significant asset growth.
A crypto futures ETF differs from direct cryptocurrency investments as it invests in futures contracts tied to the prices of digital assets like Bitcoin and Ethereum. The success of these ETFs often depends on being the first to market. For example, ProShares’ Bitcoin futures ETF accumulated over $1 billion in assets under management, while Valkyrie’s similar product gathered close to $28 million shortly after its launch.
Major financial institutions like Fidelity and BlackRock are eagerly awaiting the SEC’s decision on approving a spot Bitcoin ETF. Cathie Wood, Chief Investment Officer and Portfolio Manager at ARK Investment Management LLC, predicted during an interview on August 7, 2023, that the SEC may approve multiple spot Bitcoin ETFs simultaneously. This sentiment is echoed by the anticipation surrounding the approval of Ethereum futures ETFs.
Hot Take:
The SEC’s potential approval of Ethereum futures ETFs and the more accommodating regulatory environment are positive signs for the crypto market. It shows an increasing acceptance of digital assets and may attract more investors to the space. The success of previous futures ETFs highlights the potential for significant growth in assets under management, which could further boost the popularity of these investment vehicles.
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