ProShares Races For First US Spot Ethereum ETF: SEC Review Heats Up

The U.S. Securities and Exchange Commission (SEC) is reviewing a new application for a spot Ethereum(ETH) exchange-traded fund (ETF) from asset manager ProShares. This development adds another player to the growing list of hopeful issuers vying to launch the first U.S. ETF directly tied to Ethereum’s price.

ProShares filed a proposal on June 6th to list and trade shares of their spot Ethereum ETF on the New York Stock Exchange (NYSE) Arca. The SEC acknowledged the filing on June 10th, triggering a 21-day public comment period. The Commission itself has 45 days to make a decision, potentially by late July 2024. However, this is just the first step. SEC acknowledgment doesn’t equate to approval; it simply signifies the application is under review.

This news comes on the heels of the SEC approving rule changes for eight other spot Ethereum ETF applications in May 2024. Industry observers like Bloomberg Intelligence’s James Seyffart note the later timing of ProShares’ application might place them behind the initial launch of competing ETFs.

In a separate development, the SEC greenlit Ark Invest’s exit from a joint Ethereum ETF application with 21Shares. This allows 21Shares to pursue the ETF independently under the new name “21Shares Core Ethereum(ETH) ETF.” Ark Invest, while no longer involved with this specific Ethereum(ETH) ETF, maintains its presence in the cryptocurrency space with their existing “ARK 21Shares Bitcoin ETF (ARKB).”

While the regulatory landscape seems to be shifting, there’s still a wait for final decisions. Potential issuers are still awaiting feedback on their S-1 filings submitted in late May. While initial expectations targeted a June 7th response from the SEC, delays have pushed back the timeline. Recent reports suggest issuers might receive feedback this week, aligning with SEC Chair Gary Gensler’s comments about the S-1 approval process taking “some time.”

Also Read: Ethereum ETFs: Bitcoin’s Rival to Steal 20% of Investment Spotlight? (SEC Staking Decision Looms)

The approval process for these ETFs is a two-step hurdle: the 19b-4 filing (already cleared for several applicants) and the S-1 filing (currently under review). Analysts anticipate further rounds of comments from the SEC before final approval.

Despite the ongoing review process, the SEC’s acknowledgment of ProShares’ application and the approval of Ark Invest’s split from 21Shares signal progress in the crypto ETF space. These developments highlight growing regulatory recognition of cryptocurrency and the potential expansion of the ETF market to include major players like Ethereum.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.

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