ARK Invest And 21Shares Blaze Trail With Ethereum ETF Application Amid Crypto Frenzy

Key Points:

• ARK Invest and 21Shares seek SEC approval for a groundbreaking Ethereum ETF, the first of its kind in the U.S.
• The move follows a key SEC ruling favoring Grayscale Investments, raising hopes for crypto ETFs. The decision on the Ethereum ETF is expected by mid-October.
• Initial excitement boosted Ethereum and Bitcoin prices, although they later stabilized.

In a significant move for the crypto industry, Cathie Wood’s Ark Invest and crypto investment firm 21Shares have jointly filed for regulatory approval to establish an exchange-traded fund (ETF) focused on Ethereum. This marks the first endeavor to list an ETF in the United States that would directly invest in Ethereum, the second-largest cryptocurrency by market capitalization.

The proposed fund, named the “ARK 21Shares Ethereum ETF,” is set to invest directly in ETH and trade on the Cboe BZX exchange.

Notable entities involved in this venture include 21Shares as the trust’s sponsor, the Delaware Trust Company as the trustee, and Coinbase Custody Trust Company as the custodian. Interestingly, the SEC is anticipated to make a decision on this ETF application before mid-October.

This initiative follows a recent ruling by the U.S. District Court of Appeals, which deemed the SEC’s rejection of an ETF application from crypto asset manager Grayscale Investments, tracking the price of Bitcoin, incorrect.

This ruling has drawn attention from both the cryptocurrency and asset management sectors, both eager for SEC approval of a spot Bitcoin ETF.

The news initially propelled both Ethereum and Bitcoin prices higher, although the surge was short-lived, and both cryptocurrencies have since retraced to levels preceding the announcement.

This submission comes amid a flurry of applications for coveted spot Bitcoin ETFs, including a joint effort by Ark and 21Shares. The SEC recently delayed decisions on all such applications. Furthermore, the SEC is expected to greenlight the first futures-based Ethereum ETF by mid-October.

ARK Invest and 21Shares’ proposal is just one of several spot crypto ETFs under SEC review. Following Grayscale’s successful appeal, various firms are now optimistic about regulatory approval. Notably, the approval timeline for ARK Invest’s and 21Shares’ spot Bitcoin ETF stands at November 11.

This endeavor represents the third attempt by ARK Invest and 21Shares to launch a spot Bitcoin ETF since 2021. In addition to this, the companies have also proposed listings for two Ethereum futures ETFs, a category that has seen more success with SEC approvals following multiple green lights in 2021.

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