Grayscale Investments has officially applied to the U.S. Securities and Exchange Commission (SEC) for the approval of a new cryptocurrency exchange-traded fund (ETF). Notably distinct from the numerous Bitcoin spot ETF applications currently under SEC review, Grayscale’s proposal is centered around an Ethereum futures ETF.
According to the documents submitted by the company on Tuesday, this proposed ETF would exclusively engage in futures contracts and would not engage in direct transactions with Ether. Consequently, it would not require an Ether custodian.
Grayscale’s filing follows a recent legal victory against the SEC, where a federal judge overturned the regulator’s decision to block Grayscale’s attempt to convert its Bitcoin trust into a spot ETF.
While Grayscale anticipates approval for its Bitcoin ETF, it is also seeking SEC approval for an Ethereum futures ETF. The SEC granted its first approval for a Bitcoin futures ETF, allowing investors to speculate on future cryptocurrency prices, in 2021. These investment instruments track cryptocurrency prices without directly holding the assets.
Investors have expressed significant interest in spot cryptocurrency ETFs, and the SEC is presently reviewing several such applications, including one from the world’s largest asset manager, BlackRock. A cryptocurrency ETF would offer traditional investors a safer means of exposure to this asset class. ETFs enable individuals to purchase shares that mirror the performance of an underlying asset, allowing them to invest in cryptocurrencies without the complexities of storing and securing their digital assets.
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