SEC Approves Applications for Ether ETFs from Nasdaq, CBOE, and NYSE

SEC Approves Exchange-Traded Funds Tied to Ether, Opening Door for Cryptocurrency Trading

In a surprising move on Thursday, the U.S. Securities and Exchange Commission (SEC) approved applications from Nasdaq, CBOE, and NYSE to list exchange-traded funds (ETFs) tied to the price of ether. This decision potentially paves the way for these products to begin trading later this year.

The approval comes as a major win for ETF issuers and the cryptocurrency industry as a whole, as it was unexpected. Nine issuers, including VanEck, ARK Investments/21Shares, and BlackRock, are hoping to launch ETFs tied to ether, the second-largest cryptocurrency. This approval follows the SEC’s decision in January to approve bitcoin ETFs, which was a landmark moment for the industry.

Andrew Jacobson, vice president and head of legal at 21Shares, commented on the approval, calling it “an exciting moment for the industry at large” and a “significant step” towards getting the products trading.

The approval of the exchange applications is just the first step, as the issuers still need the SEC to approve ETF registration statements before they can start trading. While there is no set time frame for the SEC to make a decision on these statements, industry participants are hopeful that they will be able to launch soon.

The introduction of spot bitcoin ETFs has already shown significant benefits for the digital assets and ETF space, and market participants believe that spot ether ETFs will provide similar safeguards for U.S. investors. Despite this positive development, SEC Chair Gary Gensler, a crypto skeptic, declined to comment on the ether ETFs when asked by reporters at an industry event.

Overall, this approval is another step forward for the cryptocurrency industry’s push into mainstream finance. With the UK regulator also approving listed cryptocurrency products this week and the U.S. House of Representatives passing a bill seeking regulatory clarity for cryptocurrencies, the industry is gaining momentum.

While the bill still needs to pass the Senate, its bipartisan support marks a significant endorsement for the industry. Investors, including hedge funds, wealth advisors, and retail investors, have already poured more than $30 billion into crypto ETFs, showing a growing interest in these products.

The approval of ETFs tied to ether is a positive sign for the future of cryptocurrency trading and further integration into traditional financial markets.

© Thomson Reuters 2024