In a watershed moment for the crypto industry, the U.S. Securities and Exchange Commission (SEC) on Monday gave its blessing to the latest S-1 filings tied to spot Ethereum (ETH) exchange-traded funds, clearing the way for the funds to begin trading as early as Tuesday (July 23).
This marks a huge milestone for the world’s second-largest cryptocurrency by market value, indicating that the SEC considers it a commodity rather than a security.
Ether ETFs Officially Hit The Market Today
What looked highly unlikely roughly three months ago has become a reality today.
After weeks of back-and-forth on revisions on S-1 registration statements, the Securities and Exchange Commission finally approved the first roster of spot Ether-based ETFs to begin trading today on their respective exchanges like the Chicago Board Options Exchange, Nasdaq, and the New York Stock Exchange (NYSE).
It’s official: Spot Eth ETFs have been made effective by the SEC. The 424(b) forms are rolling in now, the last step = all systems go for tomorrow’s 930am launch. Game on. pic.twitter.com/9MaBDBA8co
— Eric Balchunas (@EricBalchunas) July 22, 2024
On July 22, the SEC approved registration forms from BlackRock, Fidelity, Franklin Templeton, Vaneck, Bitwise, 21Shares, Grayscale, and Invesco Galaxy. The BlackRock iShares Ethereum Trust will be listed on the Nasdaq, while the Grayscale Ethereum Trust will go live on the New York Stock Exchange.
The decision to give investors in the U.S. access to Ether through regulated and easy-to-trade products comes two months after the SEC approved their 19b-4 proposals on May 23, and follows the regulator’s greenlighting of spot Bitcoin (BTC) ETFs in mid-January. BTC ETFs have attracted over $17 billion in new investor money since their inception.
All spot ETH ETFs except the Grayscale Ethereum Trust will charge a management fee between 0.15% and 0.25%. Notably, Fidelity, 21Shares, Bitwise, Franklin, and VanEck have set the fees for their Ether investment vehicles at 0% until a set period expires or their products reach a specified amount in net assets.
Implication Of ETF Launch On Ether Price
When spot BTC exchange-traded funds went live in January, they became the most successful ETF launch in American history. Owing to the massive inflows witnessed and the speed with which traditional institutional investors rushed to invest, this propelled the Bitcoin price to new highs near $74,000 just two months later.
Some analysts project that while spot ETH ETFs could push the price of ether up to $5,000, inflows into those products will not be nearly as high as for their Bitcoin peers. Bitwise CIO, for instance, previously predicted that the newly launched ETFs could muster $18 billion worth of inflows in the first 18 months as Ethereum lacks the first-mover advantage that BTC had.
Ether is changing hands for $3,454 as of publication time, representing a 1.30% drop over the last 24 hours.
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