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ETH ETFs “inevitable” in the US, European market well ahead.

The introduction of Ethereum ETFs in the US could be another step toward mass cryptocurrency adoption, allowing investors to access ETH.

Date: 2024-03-05 Author: Łukasz Michałek
ETH ETFs “inevitable” in the US, European market well ahead.

As predicted by analysts, the U.S. Securities Exchange Commission (SEC) has made an early decision to approve or reject Ethereum funds.

Not surprisingly, the SEC delayed its decision to approve the BlackRock Ethereum ETF on Monday. VanEck ‘s application for an ETF fund to track the world’s second-largest cryptocurrency is expected to be approved or rejected by the Securities Exchange Commission by May 23.

Bitcoin ETFs were approved by the Securities Exchange Commission in January , sparking a trading frenzy as demand continued to rise. The BlackRock iShares Bitcoin Trust, traded under the stock symbol “IBIT,” is one of the approved bitcoin ETFs. So far, the BlackRock ETF, the leader of the group, has attracted $10 billion in assets under management (AUM) in less than two months since launch.

ETH ETF approval “inevitable.”

Many product providers are optimistic about the approval of more crypto products, believing that the SEC will eventually approve Ethereum ETFs due to demand.

Hector McNeil, co-founder and CEO of HANetf, a company that sells and distributes exchange traded products, told Cryptonews: “I think it’s inevitable that Ether will be next.”

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European market far outpaces US with ETH ETPs

Across the ocean in Europe, many issuers are sitting back complacently after successfully launching numerous cryptocurrency products(ETPs) years ago, giving investors exposure to Bitcoin and Ethereum. ETP cryptocurrency providers in Europe include CoinShares, 21Shares, WisdomTree, ETC Group, Valor and Fidelity.

“We already have these [ETH ETFs] in Europe, we have over $130 million of AUM in ETC Group’s physical Ethereum ETP [listed under the exchange symbol ZETH] and it has been on the market for over four years,” – HANetf’s McNeil explains.

Crypto ETP versus ETF – what’s the difference?

CoinShares, an asset management firm in Europe, says that in the United States, the term “ETF” is now used to describe all exchange traded products that aim to replicate the performance of an underlying asset or benchmark.

Due to specific fund regulations in Europe, the term “ETF” cannot be used for individual assets such as smaller baskets of assets, gold or bitcoin. On its website, CoinShares explains that this regulatory distinction means that when European investors look for a “crypto ETF,” they should look for a “crypto ETP.”

In February, CoinShares announced that investors in the CoinShares Physical Ethereum ETP, which is listed on a European exchange (symbol: ETHE/CETH), can receive a 1.25% betting reward per year.

Why is the SEC delaying decisions?

The SEC ‘s decision to delay indicates a cautious approach to cryptocurrency ETFs, as the regulator evaluates all risks and regulatory considerations associated with the products. It took more than a decade for a bitcoin ETF to be approved . In July 2013, the Winklevoss twins first applied for a Bitcoin ETF, but that application was repeatedly rejected.

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Łukasz Michałek
Łukasz Michałek
Founder of the rapidly developing cryptocurrency channel "Biblia Kryptowalut" on YouTube. He also co-creates the Arena Trading group with Marek. Łukasz is fascinated and passionate about blockchain technology and cryptocurrencies, which constitute the central element of his activity in the cryptocurrency industry.
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