ETFs
US regulators are expected to approve the launch of ether spot ETFs by July 4.
The U.S. Securities and Exchange Commission (SEC) could approve exchange-traded funds (ETFs) tied to the spot price of ether as early as July 4, as negotiations between asset managers and regulators enter in their final stages, industry executives and other participants told Reuters.
Eight asset managers, including BlackRock, VanEck, Franklin Templeton and Grayscale Investments, are seeking SEC approval for the funds. Most of them had deployed Bitcoin Spot ETF in January, the culmination of a decade-long struggle with regulators. Grayscale hopes to once again convert an existing trust into an ETF.
Executives at two companies, who requested anonymity because of the confidential nature of the discussions, said the process of amending the offering documents had progressed to address only “minor” issues. These documents must be approved before the ETFs can be launched.
A lawyer working with one of the issuers, who also requested anonymity, said the filing was “down to the final touches” and approval was “probably no more than a week or so away.” two “.
The SEC declined to comment. In an interview with Reuters earlier this month, SEC Chairman Gary Gensler said the launch date depends in part on how quickly issuers respond to the regulator’s questions.
The January launch of funds that track the spot price of bitcoin was one of the most successful in the ETF market, attracting some $8 billion in assets, according to Morningstar Direct data.
At the end of June, these nine new products held almost $38 billion in assets, although the holdings of Grayscale Bitcoin Trust – which simultaneously converted its $27 billion Bitcoin trust into an ETF – fell to $17.8 billion of dollars.
Many ETF and cryptocurrency analysts believe the launch of the new spot ether ETFs will be less impressive.
“Ethereum is not the same size in terms of market cap, nor the same volumes,” said James Butterfill, head of research at Coinshares.
The price of ether has stagnated this month, falling more than 11 percent, alongside a 9.8 percent decline in bitcoin. Bitcoin’s movements generally impact the price of ether.
Given the differences in the market size and nature of the two cryptocurrencies, inflows could be much more muted when ether ETFs launch, said Bryan Armour, ETF analyst at Morningstar.
“With Bitcoin, demand had been pent up for a decade and investor interest was off the charts,” he said. “It just won’t generate the same enthusiasm.”
The SEC has already approved the rule changes required for the New York Stock Exchange, Nasdaq and Cboe to list and supervise trading of the new products. This means that once SEC staff approves the filings, products could begin trading in as little as 24 hours.