VanEck Files for Ethereum ETF as its Bitcoin ETF Proposal is on Hold

VanEck Associates Corp. seeks approval from the U.S. Securities and Exchange Commission (SEC) to establish an exchange-traded fund called “VanEck Ethereum Trust.”

If VanEck’s proposal is approved, the VanEck Ethereum Trust will allow retail and institutional traders to gain exposure to the world’s second-largest cryptocurrency by market cap without requiring them to invest in it directly. It could also value its shares daily based on the MVIS CryptoCompare Ethereum benchmark rate.

This would be the first U.S.’s ether ETF, but not the first in North America. Three Ether ETFs premiered in Canada last month, the first in North America to have such an ETF label.

WisdomTree, another company hoping to launch a bitcoin ETF in the U.S., has also listed an ether exchange-traded product in Germany and Switzerland.

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First Bitcoin ETF in the U.S

James Seyffart, an ETF analyst, said that the fast approval of Canadian Ethereum ETFs on the heels of Bitcoin ETFs is part of the reasoning for this filing. He added that he couldn’t foresee the SEC approving an Ethereum ETF until a Bitcoin ETF has already begun trading. He said that other issuers would probably follow suit because VanEck has led the charge with these filings.

The development occurs as VanEck waits for word on whether it will introduce trading of the first bitcoin ETF in the U.S. The company also submitted an application in Dec for a Bitcoin ETF after numerous failed attempts to gain the SEC’s approval.

Investors have been left waiting in the U.S. to give the go-ahead on the country’s first bitcoin ETF though at least 11 companies are looking to launch one. Nine of those institutions have filed since the end of 2020.

VanEck plans to work with Cboe BZX Exchange on the offering. Cboe is also providing support for VanEck’s proposed bitcoin ETF.

Mainstream Acceptance

Wall Street companies are now embracing or signaling openness to include cryptocurrency into their operations. A few days ago, the S&P Dow Jones index announced the establishment of three indices.

The three will track the performance of bitcoin and ethereum – the S&P Bitcoin Index, S&P Ethereum Index, and the S&P Cryptocurrency MegaCap Index.

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The regulation authority is yet to greenlight an exchange-traded fund tied to the value of any cryptocurrency. Just recently, the federal securities regulator delayed a decision until June. Previously, the SEC has taken as much time as it legally can, almost 240 days, to gauge ETF proposals.