– Ark Invest and 12Shares have refiled their joint application for a spot market Ethereum ETF
– Amendments bring it in line with spot Bitcoin ETFs recently approved by the US Securities and Exchange Commission
– The ETF’s share creation and redemption process has been revised
– Authorized participants will deliver only cash to create shares and will receive only cash when redeeming shares
– The sponsor, 21Shares, may stake some of the fund’s underlying Ether to take advantage of staking rewards
– The SEC is expected to give a verdict on the recent round of filings for a spot Ethereum ETF before May 23, according to Standard Chartered Bank
– The SEC has been more ambiguous in its classification of Ethereum compared to Bitcoin, which could pose hurdles for ETF approval
Title: Refiled Application for Ethereum ETF Signals Potential Approval
Ark Invest and 21Shares have filed an amended application for a spot market Ethereum ETF, addressing cash creation and redemption. The amendments bring the ETF in line with spot Bitcoin ETFs recently approved by the US Securities and Exchange Commission, according to Bloomberg ETF analyst Eric Balchunas.
The most notable revision elaborates on the ETFs share creation and redemption process, emphasizing cash transactions only. The filing also discusses the potential staking of the fund’s underlying Ether to take advantage of staking rewards, with acknowledgement of liquidity risks.
Expectations for Approval:
Given the SEC’s recent approval of spot Bitcoin ETFs, analysts are confident that Ethereum ETFs will be the next to receive approval. The US is behind on crypto ETFs compared to other territories, and London-based multinational Standard Chartered Bank predicts approval by May 23. However, Ethereum’s classification as a security by the SEC could pose significant hurdles for ETF approval.
Challenges and Potential Influence:
The SEC’s ambiguity on Ethereum’s classification as a security is a potential hurdle for ETF approval. Additionally, the announcement of the first SEC-approved crypto company in the US launching Ether custody in late March could compel the SEC to clarify its stance on Ethereum. This development may influence the SEC’s decision on the approval of Ethereum ETFs.
The refiled application for a spot market Ethereum ETF brings it in line with recently approved spot Bitcoin ETFs, signaling potential approval. However, the SEC’s classification of Ethereum as a security and the impact of the upcoming Ether custody launch by an SEC-approved crypto company remain key factors influencing the approval of Ethereum ETFs.
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