The Securities and Exchange Commission (SEC) poised to approve ether (ETH) futures ETFs for trading in the U.S., Bloomberg reported on Thursday. According to Bloomberg, there is every likelihood that an ETH futures ETF will be approved soon by the SEC.
Several firms have applied to list these exchange-traded funds, which would hold derivatives contracts tied to ether – rather than ether itself.
An ETH Futures ETF (Exchange-Traded Fund) is a financial product that allows investors to gain exposure to the price movements of Ethereum (ETH) futures contracts. Ethereum futures are agreements that enable traders to speculate on the future price of Ethereum without actually owning the underlying cryptocurrency.
There are already U.S. ETFs that hold crypto derivatives: bitcoin futures ETFs. The industry is anxiously awaiting word on whether ETFs that hold Bitcoin itself, not derivatives, might also get approval.
After Bloomberg announced the news, the price of ETH went up, with the crypto community showing positivity in anticipation of such a product.
Furthermore, Bloomberg said that the SEC does not look as though it will block the applications of nearly twelve companies, including ProShares, Volatility Shares, Bitwise, and Roundhill, that have filed to launch Ether futures ETFs.
While the report notes that the approval may happen as soon as October 2023, ETF analyst Eric Balchunas said he wasn’t surprised by the SEC’s move to approve Ether futures ETFs, adding that the decision shows how the regulator’s views on different products, such as a spot Bitcoin ETF, can change over time.
The SEC and Bitcoin Spot ETFs
Bitcoin Spot ETFs have also been on the radar of the SEC, with the crypto and traditional finance communities waiting for a green light. It can be recalled that firms such as WisdomTree, BlackRock, Global X, Fidelity, Invesco, Ark Invest, and Valkyrie Digital Assets. However, the SEC has refused to approve any.
Citing its reason for disapproval, the SEC said that the applications lack vital information for approval. This has forced most of the applicants to reapply while waiting for the next decision from the SEC.
One question on the minds of many is: Will the ETH ETF and Bitcoin ETF drive the next bull run?