The applications for crypto-related ETFs are still flooding the SEC.
Valkyrie has officially lodged an application with the US Securities and Exchange Commission (SEC) to roll out an Ether (ETH) futures exchange-traded fund (ETF).
The move is a logical continuation of their prior endeavors, which included a pivot in their investment blueprint to cater to a Bitcoin (BTC) futures ETF, aligning with regulatory stipulations.
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Valkyrie's application showcases a strategic approach: while the primary investment focus will be on ETH futures contracts, it will not pour funds directly into Ether. Instead, the company is setting its sights on acquiring an array of ETH futures contracts.
This new ETF will also distribute its remaining assets in dependable avenues like cash, cash equivalents, and prime-grade securities encompassing US government-issued bills, notes, and bonds, as well as corporate debt securities and money market funds.
A vital stipulation in Valkyrie's proposal limits the ETF’s Ether futures contract investment to a cap of 8,000 contracts each month. This restriction aligns with the position limits set by the renowned Chicago Mercantile Exchange.
It is worth noting that futures contracts represent formalized pacts to buy or sell an asset in the future at a predetermined rate. Should the SEC give the green signal, this ETF would pave the way for investors to speculate on Ether's future price trajectories.
Ether, the flagship coin of the Ethereum blockchain, is predominantly used for peer-to-peer transactions within its decentralized ecosystem. The application notes:
Ether may be viewed as a currency or digital commodity, hinging on its unique function in specific transactions. Notably, while several American and global retailers do accept Ether for payments, its commercial and retail application remains rather limited. Additionally, Ether's potential as a store of value cannot be understated, despite its occasional price fluctuations.
The crypto investment community is abuzz with speculation and anticipation. Valkyrie is not alone in its ambitions. Industry insiders have highlighted that major players like Grayscale, VanEck, Bitwise, Volatility Shares, ProShares, and Round Hill Capital have submitted similar proposals to capture the US Ether futures ETF market.
The flurry of applications may be underpinned by the prevailing sentiment that the US is on the verge of approving a spot Bitcoin ETF. Leading investment titans, including Wall Street giants BlackRock and Fidelity, are eagerly awaiting their regulatory thumbs-up.
The winds of change are sweeping across the crypto ETF domain, with Valkyrie’s bid for an Ether futures ETF standing out. As the crypto world watches with bated breath, the eventual decision of the SEC could significantly shape the future of cryptocurrency investments.
