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- Volatility Shares and other top financial giants recently filed for Ethereum futures ETFs with the SEC.
- Sources familiar with the matter said that the SEC has expressed its preparedness to openly evaluate such a product.
While the crypto community was already cheering the spot Bitcoin ETF applications from BlackRock and other financial giants, there’s some chatter already around the launch of Ethereum futures ETFs in the market.
As per the latest report, top financial giants like Volatility Shares, Bitwise, Roundhill, VanEck, Proshares, and Grayscale, have already submitted an application to the US for listing their Ethereum futures ETFs. Eric Balchunas, senior ETF analyst at Bloomberg, was the first to report regarding this.
Here's fresh update of the Ether Futures ETF Race, which now has SIX in the running.. nice job by @JSeyff for putting together so quickly pic.twitter.com/G1rwwfaFoS
— Eric Balchunas (@EricBalchunas) August 1, 2023
Ethereum Futures ETFs are investment instruments that package contracts based on the future price of the cryptocurrency. These ETFs enable investors to purchase shares in this package, essentially speculating on whether the future price of ETH will increase or decrease.
These ETFs provide a means to participate in Ethereum’s price movements without directly owning the cryptocurrency. As a financial tool, they offer a structured approach for individuals seeking exposure to potential price changes in Ether, allowing them to engage in speculation in a more controlled and organized manner.
US SEC Willing to Consider Ethereum Futures ETFs
Two sources familiar with the Ethereum futures ETF filings told Blockworks that the SEC has expressed its preparedness to openly evaluate such a product. Nevertheless, it’s important to note that the regulator’s willingness to assess ether futures ETFs does not automatically ensure their approval, as one of the sources emphasized.
Henry Jim, a Bloomberg Intelligence analyst said: “From a product perspective, all the ETF issuers are probably thinking it’s worth the cost of filing rather than risk falling behind in case ETH [ETFs] take off, even in futures form”.
In May 2023, the US SEC asked companies wanting to offer ether futures ETFs to stop their efforts. However, the SEC’s stance seems to have changed, as they are now willing to consider such offerings. During this time, Grayscale, Bitwise Asset Management, Direxion, and Roundhill Investments had filed for ether futures funds, but later withdrew their applications following the SEC’s initial request.
The SEC’s recent decision to consider ether futures ETFs in the last three months has left some industry observers confused. It comes after several potential issuers had halted their plans, making the regulator’s specific reasons for this move somewhat unclear.
Matthew Sigel, head of digital assets research at fund group VanEck said: “SEC policy on crypto ETFs has always been haphazard. Now it is completely incoherent.”
Volatility Shares Pushing for Ethereum futures ETFs
In the past, the SEC has already approved the Bitcoin futures ETFs and has been comfortable with this product in the market. In June 2023, the SEC permitted the launch of the first leveraged bitcoin futures ETF. The company behind this fund, Volatility Shares, is also the one that initiated the recent surge of ether futures ETF filings.
It appears that Volatility Shares has been in direct communication with the SEC. Thus, it increases the odds of Ethereum futures ETFs as well. In general, the trend seems to be moving in favor of crypto-related ETFs, and now issuers are competing to take advantage of this opportunity.
