As an experienced market analyst, I have closely followed Grayscale’s efforts to bring Ethereum ETFs to the market. The recent withdrawal of their Ethereum Futures ETF application was not unexpected, given the dominance of VanEck’s EFUT and ProShares’ EETH in the futures Ethereum ETF market.
One day after Grayscale withdrew its application for an Ethereum Futures ETF, CEO Michael Sonnenshien announced that the company would not abandon its efforts. Instead, Grayscale intends to persist in its attempt to transform its Ethereum Trust (ETHE) into a spot Ethereum exchange-traded fund (ETF). This approach mirrors the strategy Grayscale employed when it successfully converted its Bitcoin Trust (GBTC) into a spot Bitcoin ETF.
Grayscale And Its Spot Ethereum ETF Ambitions
As a crypto investor following the Financial Times event, I can tell you that Sonnenshein from Grayscale shared his perspective. He revealed that their team has chosen to put most of their efforts into developing and enhancing their spot products. This approach aligns with their fundamental mission at Grayscale.
The Grayscale CEO explained that they chose to withdraw their Ethereum futures ETF application due to the existing availability of similar products in the market.
VanEck’s EFUT and ProShares’ EETH are the leading contenders in the Ethereum ETF market, accounting for over 90% of the total trading volume between them. However, it’s important to note that filing an application for a product does not guarantee its eventual launch into the market, as Sonnenshein cautioned.
As an analyst, I can tell you that Grayscale, alongside heavyweights such as VanEck, Blackrock, Fidelity, and Ark Invest, have submitted applications to the Securities and Exchange Commission (SEC) for launching a spot Ethereum exchange-traded fund (ETF) in the market. Yet, only recently, the SEC announced that it would postpone its decision regarding the Invesco Galaxy Ethereum ETF until July.
Cryptocurrency fans have been anxiously counting down to the debut of a spot Ethereum exchange-traded fund (ETF), with the initial deadline looming on May 23rd. Nevertheless, financial experts are not optimistic about the Securities and Exchange Commission (SEC) granting approval, given that Ethereum’s classification as a ‘security’ remains uncertain.
Grayscale Mini Trust
Grayscale has filed documents to establish a smaller trust, called the Grayscale Ethereum Mini Trust, which will initially be funded with assets from its larger trust. According to Craig Salm, Grayscale’s legal officer, this new trust is intended to expand Grayscale’s offerings of Ethereum-focused investment vehicles, catering to different investor preferences.
In the course of Wednesday’s talks, Sonnenshein voiced doubt regarding the Securities and Exchange Commission’s position on Ethereum. Nevertheless, he relayed Grayscale’s belief that the SEC will give priority to investors’ concerns. He further mentioned:
“I, as an analyst, would like to note that Grayscale Ethereum Trust is currently an SEC reporting company. This means we submit 10-Ks and 10-Qs filings to the Securities and Exchange Commission. Furthermore, our business has consistently advocated for regulatory acceptance of cryptocurrencies by engaging with regulators and pushing the boundaries of what’s permissible within the regulatory framework.”
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2024-05-09 08:01