Valkyrie, the asset management company, has applied to the US SEC for an Ether (ETH) futures ETF.
This initiative follows Valkyrie’s earlier alteration of its investment approach for a Bitcoin (BTC) futures ETF to align with regulatory guidelines.
According to the submitted application, the fund’s strategy will involve acquiring multiple ETH futures contracts rather than a direct investment in Ether.
The application details state that Ether’s characterization as a currency or digital commodity hinges on its application in specific transactions, potentially serving as a medium of exchange or unit of account.
While some retailers accept Ether in the US and global markets, its use for commercial and retail transactions is moderately restricted. The document also acknowledges Ether’s potential as a value store and its significant price volatility.
Alongside its investments in Ether futures, the ETF’s remaining assets will be allocated to cash, cash-like instruments, and high-quality securities. This category encompasses U.S. government bills, bonds, notes, money market funds, and corporate debt securities.
Moreover, within the ETF framework, the investment allocation towards Ether futures contracts will be confined to 8,000 monthly contracts, aligning with the position limits dictated by the Chicago Mercantile Exchange.
These futures contracts entail predetermined agreements to buy or sell an asset at a designated price in the future. Upon approval, investors will have the opportunity to speculate on forthcoming Ether prices via the ETF platform.
Other crypto ETFs
In addition to its Ether ETF, Valkyrie had made some other notable moves in the ETF space. It recently resubmitted its application for a spot Bitcoin exchange-traded fund (ETF) to the SEC on July 5.
The asset management giants like BlackRock and Fidelity are also making renewed attempts at the ETF approval process. This included filing the 19b-4 document, which indicated that cryptocurrency exchange Coinbase would serve as the collaborating partner for a surveillance-sharing agreement.
More recently, the Tennessee-based firm also submitted a 497 filing, outlining their intention to transform $BTF into a dual Bitcoin and Ether ETF by Oct. 3. This timeline positions their potential launch two weeks before the other 13 entities scheduled for similar launches.
As the race to have the first Bitcoin Spot ETF approved wears on, much of the community remains on close watch for any new filings and amendments to see which firm will get the leg up as the first mover.