Before funds can be listed, issuers must wait for final regulatory approval of their S-1 filings.
The Grayscale Ethereum Mini Trust and ProShares Ethereum ETF have been approved by the US Securities and Exchange Commission (SEC) for listing on the New York Stock Exchange’s (NYSE) Arca electronic trading platform. According to a document dated July 17, the SEC issued the announcement.
ETFs for Ethereum Pending SEC Approval of S-1 Filings
However, trading for these two ETFs is not yet available. One of the final processes is to wait for feedback on each ETF’s S-1 filing.
“After cautious review, the Commission found that the proposition is steady with the Exchange Act and the rules and directions appropriate to national securities Exchange,” the SEC said.
Among the major players, the Grayscale Ethereum Mini Trust is notable. It follows on from its predecessor, the Grayscale Ethereum Trust (ETHE), a closed-end fund that was recently converted into an exchange-traded fund. This change reflects Grayscale’s vision of providing more easily accessible investment products while accommodating the needs of investors and regulatory requirements.
Bloomberg ETF analyst James Seyffert presented his analysis on the strategic asset allocation of the Grayscale Ethereum Mini Trust. This strategy aims to provide stability during the product introduction, providing protection from any outflows.
“The Mini Ethereum ETF will be launched alongside other ETFs. ETH will hold 10% of ETHE’s assets from the start. This will help mitigate potential outflows to Grayscale,” Seifert said.
Meanwhile, ProShares joined the Ethereum ETF market a little late. As a result, these ETFs are part of a larger trend of comparable products that will hit the market soon. Eight spot Ethereum ETFs are expected to be listed soon, with final SEC approval expected.
These developments come after extensive discussions between issuers and the SEC. Such conversations underscore that cryptocurrency-based products require rigorous scrutiny when placed on regulated financial exchanges. This approach is crucial to protecting investors while supporting the growing demand for digital assets.
The financial design of these ETFs seeks to draw potential investors. Most of the upcoming Ethereum ETFs, such as those from Fidelity, VanEck, and Franklin Templeton, will initially have no fees. However, Grayscale’s products will continue to have a higher fee structure of 2.5%, just like its Bitcoin-focused funds.
Fee Structure of Ethereum ETFs. Source: Bloomberg
This shows the premium paid for Grayscale’s brand and management competence in the cryptocurrency investment industry.
