ARK 21Shares has released a preliminary prospectus for its spot Ethereum exchange-traded fund (ETF). Scheduled to trade on the Cboe BZX Exchange, the ARK 21Shares Ethereum ETF aims to track the performance of ether via the CME CF Ether-Dollar Reference Rate – New York Variant.
This Index reflects the performance of ether in U.S. dollars and is administered by CF Benchmarks Ltd.
The ETF itself won't actively trade ether, it will offer "in-kind" transactions in blocks of 5,000 shares, which are based on the quantity of ether attributable to each share.
According to the prospectus, the Trust will custody its ether with Coinbase Custody Trust Company, LLC.
Ethereum ETF speculation rises
The Ethereum ETF comes amid heightened speculation around cryptocurrency exchange-traded funds. The number of applications for Ethereum and Bitcoin futures ETFs has surged to twelve, following recent submissions from key players like Bitwise.
As reported by U.Today, ETF analysts James Seyffart and Eric Balchunas recently raised the likelihood of Ethereum futures ETFs receiving approval to 75%, matching the odds they gave to Bitcoin futures ETFs last year.
The SEC's ETF dilemma
Grayscale Investments is pushing the U.S. Securities and Exchange Commission (SEC) to quickly approve its conversion of the Grayscale Bitcoin Trust into an ETF after a court ruling that the SEC had erred in its initial rejection of the application. The SEC, which has until mid-October to seek reconsideration, could either approve Bitcoin ETFs this year or delay the process until 2024 if it decides to appeal the court decision.
Jay Clayton, former chair of the SEC, has indicated in a recent CNBC interview that the approval of spot Bitcoin ETFs is "inevitable," but there's no certainty that Ethereum will follow the same path.
Denys Serhiichuk
Tomiwabold Olajide
