ARK Invest, in collaboration with 21Shares, has submitted an application to the U.S. Securities and Exchange Commission (SEC) for an Exchange-Traded Fund (ETF) that would directly hold Ether (ETH). This groundbreaking move, as revealed in a Wednesday filing, is the first attempt to list such a fund in the U.S., specifically focused on ETH, the second-largest cryptocurrency by market capitalization.
The proposed ETF, titled ‘Ark 21Shares Ethereum ETF’, has earmarked Coinbase Custody Trust Company as its potential custodian for the assets. Following the news of this application, both Ether and Bitcoin experienced a surge, although this uptick in prices was temporary, retracing to their earlier levels prior to the announcement.
This latest move by ARK Invest and 21Shares is not their maiden venture into the crypto ETF space. They, among other entities, have previously sought approval for a spot Bitcoin ETF. However, the SEC recently pushed back its decision on these applications, postponing the verdict.
The timing of this application is also notable as the market anticipates SEC’s endorsement of the inaugural futures-based Ether ETF, with a resolution expected by mid-October.
Last month, a report from broker Bernstein highlighted the potential momentum in the crypto ETF arena, driven by Grayscale’s recent courtroom win against the SEC. According to this report, a spot Ether ETF, considering its structural similarities to Bitcoin in terms of actively traded futures and spot markets on the Chicago Mercantile Exchange (CME), emerges as a strong contender. The CME remains a pivotal regulated platform for institutional investors.
With the crypto industry’s rapid evolution, the coming months will be decisive in setting the trajectory for crypto ETFs in the U.S. market.
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