Ethereum futures ETFs get together to apply, and the gears of the fate of encrypted ETFs start to turn?

By Ben Strack, Blockworks

Compiled by: Felix, PANews

Several institutions have previously applied to the US Securities and Exchange Commission (SEC) for Ethereum futures ETFs, but they withdrew their applications earlier this year due to the "hint" of regulators. Recently, many institutions have applied again, which seems to indicate that the attitude of the US SEC has changed, at least now they are willing to consider the approval of Ethereum futures ETF.

Volatility Shares applied for an ethereum futures ETF on July 28, and now others, including Grayscale Investments, Bitwise, Roundhill Investments, ProShares and VanEck, have followed suit this week with applications. The next deadline for the US SEC to make a decision on the above application is October 16, and the next deadline to make a decision on the Volatility Shares application is October 11.

The SEC has signaled its readiness to publicly consider such a product, according to two sources with direct knowledge of the latest ethereum futures ETF filing. However, a source added that regulators are willing to weigh in on an ethereum futures ETF, but there is no guarantee that it will be approved.

“From a product standpoint, all ETF issuers probably agree that in case an ETH ETF takes off, even in the form of futures, it’s worth paying the application cost,” said Bloomberg Intelligence analyst Henry Jim.

The U.S. SEC’s willingness to consider these products is the opposite of what happened in May, when sources said the U.S. securities regulator had told firms seeking ethereum futures ETFs to stop applying. The SEC did not respond to a request for comment at the time.

For example, Grayscale had sought to launch an ethereum futures ETF in May, but amended a document days later to indicate that it no longer intends to do so. Bitwise Asset Management, Direxion and Roundhill Investments followed Grayscale in withdrawing applications.

The U.S. SEC’s decision to consider an ethereum futures ETF over the past three months has baffled some industry observers after various potential issuers paused applications. The exact reason behind the regulator's move remains a mystery.

Matthew Sigel, director of digital asset research at the VanEck Fund, said: "The SEC's policy on encrypted ETFs has always been arbitrary, and now it is not implemented at all."

**The wind direction in the crypto ETF field is changing? **

Bradley Duke, chief strategy officer of ETC Group, said in a statement that there appears to be a growing acceptance of cryptocurrencies among the SEC as an "inevitable part of the U.S. investment landscape."

Nate Geraci, president of The ETF Store, pointed out that the sentiment around cryptocurrency-related ETFs has indeed become more positive in the past few months.

“Overall, the winds appear to be turning in favor of cryptocurrency-related ETFs, with issuers now vying for market space in an attempt to capitalize,” Geraci said.

The US SEC also allowed the first leveraged bitcoin futures ETF to go public in June. The company launching the fund is none other than Volatility Shares, which also launched the latest wave of ethereum futures ETF applications.

“Volatility Shares has apparently had direct communication with the SEC recently, and it is reasonable to assume that Volatility Shares has seen or heard some indication that an Ethereum futures ETF may be approved,” Geraci said.

In October 2021, the SEC approved ETFs that hold bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME). The ProShares Bitcoin Strategy ETF (BITO), the first fund to launch under the approval, is well ahead of its competitors in terms of assets under management, with about $1 billion in size.

“It seems illogical that the U.S. SEC would allow an ETF to hold CME-traded Bitcoin futures, but not allow an ETF to hold CME-traded Ethereum futures,” Geraci said. how to respond".

Related reading: Digital Reading Bitcoin ETF: The total assets of 5 futures ETFs are nearly 1.3 billion US dollars. How much is Bitcoin affected by the application news?