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The US SEC will review and approve decisions for five Ethereum spot ETFs by the end of May, but may also be postponed until August to make the final decision.
In addition, the final decision period for three Ethereum spot ETFs that have already applied is at the end of May 2024, before that, the US SEC needs to make a final decision on whether to approve it or not.They are due to VanEck Ethereum ETF, Ark 21Shares Ethereum ETF and Hashdex Ethereum ETF, respectively.Final deadlines are May 23, May 24 and May 30.
According to Cointelegraph, the SEC must also make a decision on Grayscale’s application by June 18 and on Invesco’s application by July 5.Fidelity and BlackRock applications must be decided by August 3 and August 7.
Bloomberg ETF analyst Eric Balchunas said he estimated the ETH spot ETF to be approved in May is 70%.
Coinbase also said that applications for Ethereum spot ETFs may be approved soon.
Ethereum Spot ETF is an investment fund listed and traded on a stock exchange with the goal of tracking the price performance of Ethereum (ETH).
Unlike buying or holding ETH directly, investors can indirectly gain exposure to ETH price fluctuations by purchasing stocks of Ethereum spot ETFs without managing or storing ETH.In this way, investors can avoid some risks and obstacles related to direct ETH trading, such as security, digital wallets, regulatory uncertainty, insufficient liquidity, etc.
Simply put, Ethereum Spot ETF is an investment fund listed and traded on the stock exchange. It directly holds Ethereum as the underlying asset to track Ethereum’s price performance.This investment approach provides investors with a convenient and secure way to participate in the cryptocurrency market without worrying about security and digital wallets.
It can also be said that it can make it easier for investors to access innovative and potential crypto assets like Ethereum without having to master complex technical knowledge or face high transaction costs.In addition, because Ethereum spot ETFs are traded on traditional stock exchanges, it is also subject to stricter regulation and transparency requirements, thereby increasing investor confidence and protection.
With giants entering the market, will Ethereum spot ETF still be far away?
The application for Ethereum Spot ETF was proposed in the context of Bitcoin Spot ETF.Bitcoin Spot ETFs are ETFs that track Bitcoin prices, and their applications have experienced years of setbacks and delays until on January 11, 2024, the Securities and Exchange Commission (SEC) finally approved the listing and trading of 10 Bitcoin Spot ETFs.This is a historic breakthrough in the cryptocurrency market and also opens the door to ETF applications for other cryptocurrencies.
According to data from The Block’s signing of Yahoo Finance, the trading volume of US spot Bitcoin ETFs reached US$1 billion on the second day.
The success of Bitcoin spot ETFs shows that the market has a strong demand and interest in cryptocurrency ETFs, especially traditional, conservative, institutional investors who want to go through a regulated, convenient, and low-cost channel., participate in cryptocurrency investment.
After the Bitcoin spot ETF was approved, the industry immediately promoted the application of Ethereum spot ETFs, because the market structure of Ethereum is similar to the trading CME futures market and spot market.
It can be said that Ethereum’s market value is second only to Bitcoin, occupying the second place in the cryptocurrency market, and its trading volume is also very active, with more than US$10 billion per day.Ethereum’s technological innovation and ecological development are also very rapid, supporting countless DApps and decentralized finance (DeFi) projects, providing more value and possibilities for the cryptocurrency market.
According to public information, applications for 6 Ethereum spot ETFs have been submitted to the SEC, respectively from the following institutions:
Asset management giant BlackRock, the ETF it applied for is called iShares Ethereum Trust;
Grayscale, a cryptocurrency professional institution, applies for an ETF to convert its existing Ethereum Trust (ETHE) into an ETF;
Asset management company Vaneck, the ETF it applied for is called Vaneck Ethereum Trust;
Investment management company Invesco cooperates with Galaxy Digital, and the ETF it applied for is called the Invesco Galaxy Ethereum Trust;
Investment management company ARK Invest cooperates with 21Shares, and the ETF it applied for is called ARK 21Shares Ethereum Trust;
The digital asset management company Hashdex, the ETF it applies for is called Hashdex Ethereum Trust.
These institutions have extensive experience and good reputation in the cryptocurrency field, and their applications show confidence and expectations for Ethereum spot ETFs.
Their application also refers to the application process and requirements of the Bitcoin spot ETF, striving to meet SEC standards and expectations.For example, they all chose Coinbase, the largest cryptocurrency exchange in the United States, as the custodian of its ETH to ensure its ETH is safe and compliant.
They also have market oversight agreements with Coinbase to share market data and regulatory information with the SEC to prevent market manipulation and fraud.They also pointed out that Ethereum futures have been listed on the Chicago Mercantile Exchange (CME) and that Ethereum futures ETFs have been approved, indicating Ethereum’s market maturity and regulatory compliance.
The future of Ethereum’s stars
If the Ethereum spot ETF is approved by the SEC, it will have a significant impact on Ethereum itself, the cryptocurrency market and the traditional financial markets.Specifically, the analysis can be carried out from the following aspects:
The approval of the Ethereum spot ETF will enhance Ethereum’s visibility, reputation and legitimacy, bringing it closer to the recognition and acceptance of mainstream finance.This will attract more capital to flow into Ethereum, driving its price increase and market capitalization growth.
At the same time, the approval of Ethereum spot ETF will also promote Ethereum’s technological innovation and ecological development.Inspire more developers and users to participate in the Ethereum platform and DApps, increasing their network effects and value capture.In addition, the approval of the Ethereum spot ETF will also be for other Ethereum-based cryptocurrencies.Such as ERC-20 tokens and NFTs, provide more exposure and opportunities to expand their market size and influence.
The approval of the Ethereum Spot ETF will provide a new, potential, diversified investment vehicle for traditional financial markets, increasing their exposure and participation to cryptocurrencies.
This will promote the interaction and integration of traditional financial markets and cryptocurrency markets, and accelerate the popularization and application of cryptocurrencies.At the same time, the approval of Ethereum spot ETFs will also create precedents and conditions for ETF applications in other cryptocurrencies, broaden the variety and scale of cryptocurrencies, and enrich investors’ choices and opportunities.
Written at the end
Ethereum Spot ETF is an ETF that tracks Ethereum prices. Its application was submitted after the Bitcoin Spot ETF was approved. At present, 6 applications for Ethereum Spot ETFs have been submitted to the SEC.
If the Ethereum spot ETF is approved by the SEC, it will have a significant impact on Ethereum itself, the cryptocurrency market and the traditional financial markets.Promote Ethereum’s popularity, reputation, technological innovation, ecological development, price increase and market value growth, attract more funds and investors to participate in cryptocurrency investment, promote the interaction and integration of traditional financial markets and cryptocurrency markets, and acceleratePopularization and application of cryptocurrencies.
