Fidelity, a leading asset management firm with a $4.5 trillion portfolio, has filed an S-1 form for a Spot Ethereum Exchange-Traded Fund (ETF), complete with staking provisions.
This formal registration with the US Securities and Exchange Commission (SEC) marks the inception of what is tentatively titled the Fidelity Ethereum Fund.
The SEC’s recent approval of the inaugural Spot Bitcoin ETF in the United States earlier this year, in which Fidelity was among the pioneering 11 issuers, ushered in a transformative era for the digital asset market.
This landmark decision has been nothing short of a catalyst, propelling Bitcoin to unprecedented heights, with its value soaring to $73,000 in March. The implications of this milestone extend far beyond mere price records, as industry experts anticipate a sustained upward trajectory for the asset.
The upward trajectory of Bitcoin is even more anticipated, especially with the upcoming Bitcoin halving, which a surge has historically followed in the price of Bitcoin.
With the success of Bitcoin ETFs setting a precedent, speculation naturally turned to the possibility of similar investment vehicles for other prominent cryptocurrencies. Ethereum emerged as a prime candidate, given its stature and market influence.
Having already ventured into the market of Bitcoin ETFs, Fidelity has formally applied for a Spot Ethereum ETF with the SEC, a move that includes provisions for staking.
Fidelity’s initial filing for a Spot Ethereum ETF dates back to November of the previous year, aligning it with other industry heavyweights such as BlackRock, VanEck, and ARK Invest.
The proposed Fidelity Ethereum Fund is set to issue shares tradable on the Chicago Board Options Exchange (CBOE), offering investors exposure to Ethereum while incorporating staking mechanisms.
The possibility of Ethereum getting an ETF spot hasn’t been without its challenges. Reports suggest that the SEC is conducting legal scrutiny that may affect Ethereum’s regulatory status.
The Securities and Exchange Commission (SEC) has subpoenaed companies working with the Ethereum Foundation, raising concerns that this investigation could delay the approval of cryptocurrency-related ETFs. Despite this, Coinbase’s chief legal officer argues that the SEC has no valid reason to reject the ETF approval.
