Despite the historic approval of 11 spot Bitcoin exchange-traded funds in January, industry observers were pessimistic about the United States Securities and Exchange Commission (SEC) giving the green light to an Ethereum equivalent.
But on May 23, after months of little engagement with applicants, the regulator quietly said yes to the products.
An exchange-traded fund (ETF) is a popular investment vehicle that trades on a stock exchange. It allows investors to buy shares that track the price of an underlying asset—which could be anything from gold and foreign currencies to crypto and tech stocks.
The approval of spot Ethereum ETFs—just like the Bitcoin ones—means that fund managers can take care of buying and storing the ETH digital coins, and people can buy shares that track their value. This will give people exposure to the second-biggest cryptocurrency by market cap.
Several prestigious financial firms received the green light from the SEC. They still have to do a bit more paperwork before the funds start trading, but the products should be on stock exchanges this year.
Here are the ETH ETFs that will soon hit the markets.
BlackRock
BlackRock, the world’s biggest asset manager, got the green light for its iShares Ethereum Trust. It first filed an S-1 form for the product back in November.
The firm’s CEO, Larry Fink, is seemingly enthusiastic about the cryptocurrency and its network, and has said that there is “value in having an Ethereum ETF.” He has also talked about “tokenization” being inevitable.
Grayscale
Crypto asset manager Grayscale got a yes from the SEC after filing a proposal in October to convert its Grayscale Ethereum Trust into a spot Ethereum ETF.
The current trust right now operates like a closed-end fund. But when it trades as an ETF, investors will be able to easily redeem shares. Its Bitcoin Trust converted into an ETF in January, so there’s already precedent for how such a crypto vehicle can transition over to a spot ETF.
Grayscale is a big part of the reason why Bitcoin ETFs are trading in the U.S. right now. In a landmark moment for the crypto industry last year, a judge sided with the firm in a lawsuit, agreeing with the firm that Wall Street’s biggest regulator lacked a coherent explanation for denying its proposed conversion to a Bitcoin ETF after years of denials.
The ruling paved the way for the SEC to give the green light to spot Bitcoin ETFs.
Ark Invest/21Shares
Cathie Wood’s heavyweight tech investment management firm, ARK Invest, filed a proposal with the SEC for an Ethereum ETF back in September.
The ETF is in partnership with crypto ETF issuer 21Shares and names Coinbase, America’s biggest digital asset exchange, as its custodian—meaning that the recognized company would hold and store the ETH in the product.
Fidelity
Financial services giant Fidelity made it clear that it wanted to drop an Ethereum ETF back in November when Cboe—the exchange where the product would trade—filed a 19b-4 on behalf of the firm.
Then, in March, the massive firm filed its S-1 with the SEC for its Fidelity Ethereum Fund.
VanEck
Asset manager VanEck was the first fund manager to file a proposal for an Ethereum ETF with the SEC back in 2021. It later that year withdrew its proposal and has since filed again.
The firm’s Bitcoin ETF has been a successful product, and VanEck even waived its fees to better compete with the other funds on the market.
Hashdex
The Nasdaq in September filed a proposal on behalf of Brazilian fund manager Hashdex for its Hashdex Nasdaq Ethereum ETF.
Hashdex has several crypto ETFs already trading in Brazil. In the U.S., its Hashdex Bitcoin ETF was given the green light by the SEC in January, and began trading in March.
Franklin Templeton
Wall Street giant Franklin Templeton entered the race in February when it filed a proposal with the SEC. The firm’s Franklin Bitcoin ETF launched earlier this year and trades under the EZBC ticker.
Invesco/Galaxy Digital
Asset management giant Invesco submitted a proposal with Mike Novogratz’s Galaxy Digital for an ETH ETF back in September. The S-1 form mentions that Invesco would be the sponsor for the product, while Galaxy Digital would work as its “execution agent”—selling ETH to pay the Invesco Galaxy Ethereum ETF’s expenses.
Bitwise
Digital asset investment firm Bitwise filed its S-1 form with the SEC to offer a spot Ethereum ETF back in March.
Matt Hougan, Chief Investment Officer at Bitwise, has said that he expects ETH ETFs to launch in December—and predicted they would be more successful if approved later in the year anyway. We’ll have to see when they actually launch at this point following the May approval.
Edited by Andrew Hayward
Editor’s note: This story was originally published on May 11, 2024 and last updated with new details on May 26.
