Focus Multiple Ether futures ETFs filed in wake of spot BTC ETF filings |Get all the essential market news and expert opinions in one place with our daily newsletter.Receive a comprehensive recap of the day’s top stories directly to your inbox.| ( [Kitco News](/)) – Following the rush by some of the world’s largest asset managers to file spot Bitcoin ( BTC ) exchange-traded fund (ETF) applications, institutions are now clamoring to launch Ether (ETH) futures ETFs for customers in the U.S.According to a post from Bloomberg ETF analyst James Seyffart, five major asset managers have now filed Ether-related ETF applications in recent days.“We officially have 5 different Ethereum futures ETF filings submitted to the SEC,” Seyffart said.“Would love to know what has changed since May, other than the fact that someone (Volatility Shares) applied on Friday.ProShares went straight for the inverse/short ETF.” Ether ETF filings.
Source: Seyffart’s post came in response to a https://twitter.com/ETFhearsay/status/1686495327333863424 from Bloomberg ETF analyst Henry Jim, who noted that the four futures-based Ether ETF re-filings and the one new filing are “all effective October 16.” The five products are the Bitwise Ethereum Strategy ETF, Roundhill Ether Strategy ETF, VanEck Ethereum Strategy ETF, ProShares Ether Strategy ETF, and the newly filed ProShares Short Ether Strategy ETF.In addition to the products identified by Seyffart and Jim, digital asset manager Grayscale has also filed two applications for a proposed Grayscale Global Bitcoin Composite ETF and a Grayscale Ethereum Futures ETF.According to the SEC filing by Grayscale, the Ether futures ETF will invest in futures contracts that are set to be traded on the Chicago Mercantile Exchange (CME).The fund will primarily invest in “cash settled, front-month Ether Futures,” which are contracts with “the shortest time to maturity.” “The Fund may also invest in back-month, cash-settled Ether Futures contracts,” the filing said.“As the futures contracts approach expiration, they may be replaced by similar contracts that have a later expiration.
This process is referred to as ‘rolling.’ The Fund intends to ‘roll’ its Ether Futures prior to expiration.” The SEC https://www.sec.gov/Archives/edgar/data/1884021/000138713123009033/ethu-485apos_072823.htm by Volatility Shares says the Ether Strategy ETF will invest its assets in “cash-settled contracts referencing Ether that trade only on an exchange registered with the Commodity Futures Trading Commission, which currently is the CME, and cash, cash-like instruments or high-quality securities that serve as collateral to the Fund’s investments in Ether Futures Contracts.” This fund will not invest directly in Ether.Volatility Shares also intends to enter into cash-settled Ether futures contracts as the buyer.
In cash-settled futures markets, counterparties typically pay cash to the buyer if the price of a futures contract goes up, while the buyer would pay the counterparty if the price of the futures contract goes down.
VanEck’s https://www.sec.gov/Archives/edgar/data/1137360/000113736023000537/vaneckethereumstrategyetf4.htm is similar to the filing by Volatility, minus the plans to be a buyer, and notes that “The Fund seeks to invest in ETH Futures so that the total value of the ETH to which the Fund has economic exposure is approximately 100% of the total assets of the Fund.” In the event that the fund’s exposure to ETH exceeds 100% of its net assets, “the Fund will generally have leveraged exposure to the value of ETH,” the filing states.“This means that any changes in the value of ETH will generally result in proportionally larger changes in the Fund’s net asset value, including the potential for greater losses than if the Fund’s exposure to the value of ETH were unleveraged.” | | ProShares’ Short Ether Strategy ETF will invest in daily contracts that look to profit on losses of the S&P CME Ether Futures index.“If the Fund is successful in meeting its investment objective, it should gain approximately as much as the Index loses when the Index falls on a given day,” the https://www.sec.gov/Archives/edgar/data/1174610/000168386323005800/f25596d1.htm states.“Conversely, it should lose approximately as much as the Index gains when the Index rises on a given day.The Fund does not seek to achieve the inverse (-1x) of the daily performance of the Index for any period other than a day.” The Bitwise Ethereum Strategy ETF https://www.sec.gov/Archives/edgar/data/1928561/000138713123009144/bitwiseeth-485apos_051023.htm is also similar to the other applications and states that “The Fund will invest in ETH Futures Contracts exclusively through a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands.The Fund will not invest directly in ETH Futures Contracts,” and will instead invest in cash-settled, front-month ETH futures contracts and back-month, cash-settled ETH futures contracts.
Bitwise made a point to stress that “The Fund does not invest in, or seek direct exposure to, the current ‘spot’ or cash price of ETH,” and said, “Investors seeking direct exposure to the price of ETH should consider an investment other than the Fund.” While crypto proponents have welcomed the surge in institutional interest, the sudden flurry of filings has left many wondering what has changed in recent months to prompt the firms’ increased focus on digital assets.“Back in June, the SEC [advanced] several filings for the US’s first spot Bitcoin ETF,” said Bradley Duke, Founder and Chief Strategy Officer of ETC Group.“Now we are once again seeing a flurry of applications for futures-based Ethereum ETFs, including an inverse ‘short’ ETF from Proshares.” “What remains a mystery is what has changed that prompted this sudden stream of applications,” he continued.
“What does seem clear is that there seems to be a growing acceptance at the SEC that crypto is an inevitable part of America’s investment landscape, and this is good news for crypto investors and service providers around the world.”.
