Important news from financial giant Fidelity, which, after applying for a spot ETF on Bitcoin, is now advancing its application for an ETF on Ethereum. In the event of a positive outcome regarding approval, this could significantly change crypto investments in the United States. See below for all the details.
Summary
News: Fidelity moves forward with an ETF on Ethereum after proposals for Bitcoin
As anticipated, Fidelity, the asset management giant, has officially advanced a request to create a spot ETF related to Ethereum, following the example of its previously filed request for a spot ETF on Bitcoin.
According to the filing, approval of an ETH Spot ETP at this time would represent a significant victory for U.S. investor protection in the cryptocurrency arena.Â
It is also argued that investors are currently exposing themselves to significant risk without the availability of such products as they seek alternative and riskier avenues to gain exposure to the sector.
The filing referred to the recent court decision regarding Grayscale, noting that the court held that the SEC failed to provide a coherent justification for rejecting spot crypto ETFs when it allowed futures-based products.
Grayscale’s victory against the SEC over Bitcoin ETF
A court recently scored a victory for Grayscale Investments in its legal battle against the Securities and Exchange Commission (SEC) regarding its application for a spot exchange-traded fund (ETF) on Bitcoin.Â
According to the verdict, the SEC is required to review Grayscale’s ETF proposal, as indicated by Jenn Rosenthal, Grayscale’s head of communications.
In the detailed opinion, the court specifically addressed the SEC’s differential treatment of spot ETFs on Bitcoin versus Bitcoin futures ETFs.
In fact, Grayscale demonstrated that its proposed Bitcoin ETF was similar to the already approved Bitcoin futures ETFs, both in terms of underlying assets and surveillance sharing arrangements.
Therefore, the court held that Grayscale should be “the same probability of detecting fraudulent or manipulative behavior in the Bitcoin and Bitcoin futures market.”
In addition, the court stated that the rejection of Grayscale’s proposal was arbitrary and capricious because the Commission failed to provide an adequate explanation for its different treatment of similar products.
In response, Grayscale welcomed the court’s decision, stating that the recognition of their petition overrules the order denying the proposal.
A Grayscale spokesperson said this decision is a monumental step for U.S. investors, the Bitcoin ecosystem, and all those who have sought exposure to Bitcoin through an ETF.
SEC delays crucial decisions on crypto ETFs: why?
The U.S. Securities and Exchange Commission (SEC) recently delayed critical decisions on important applications in the cryptocurrency exchange-traded fund (ETF) industry.
These include Hashdex‘s proposal to convert its Bitcoin Futures ETF to a spot ETF and Grayscale’s new application for a futures-based Ether ETF.
In an interview with CoinDesk, Quinn Thompson, Maple’s head of growth and capital markets, explained the delay strategy adopted by the SEC.
According to Thompson, the delay is an organizational move to coordinate multiple ETF applications, seeking a simultaneous launch in January.
This coordination is likely related to seeking clarity, especially in view of concerns about a possible government shutdown.
Thompson pointed out:
“The SEC intends to prepare all filings for a collective launch, similar to what it saw with the Ethereum Futures ETF last month.
This means that if one application, like BlackRock’s, faces delays, others, like Hash Dex’s, also face delays.
This is primarily an administrative strategy, perhaps influenced by the assurance that there will not be a government shutdown.”
Despite the benefits that large companies could reap from this coordination, Thompson points out the challenges that smaller entities could face.
However, he also highlights the overall positive impact on the industry, with growing support from institutional finance teams for cryptocurrency allocation among investors and asset allocation.
In any case, as the market anxiously awaits the SEC’s decision on a spot ETF on Bitcoin within an eight-day window, signs of active dialogue between the SEC and crypto exchanges are emerging.
Eric Balchunas, senior ETF analyst at Bloomberg, highlighted ongoing discussions about the need for changes, indicating a progressive dialogue in the cryptocurrency regulatory landscape.
