ProShares, a well-known provider of exchange-traded funds (ETFs), has submitted a request to list and trade shares of spot Ethereum (ETH) ETFs on the New York Stock Exchange (NYSE).
As per the documentation filed with the United States Securities Exchange Commission (SEC), the ProShares Ethereum ETF will utilize Coinbase Custody Trust Company for the custody of ETH. It has been mentioned that the company and its affiliates will not participate in activities related to Ethereum staking.
Reports from Crypto.news suggest that potential issuers of spot Ethereum ETFs have made adjustments to their 19b-4 and S-1 filings to exclude staking aspects. These modifications are intended to address the SEC’s stance on staking in relation to spot Ethereum ETFs.
However, the approval of these ETFs without staking capabilities may deter investors who are interested in earning additional yield through staking rewards. Typically, individuals who purchase, hold, and stake ETH can receive staking rewards, leading to increased yield. The absence of the staking feature means that spot Ethereum ETFs will not provide these supplementary benefits to investors.
The SEC has a timeframe of 45 days, which can be extended to 90 days, from the date of notice publication to respond to the filing. Given that ProShares’ spot ETH ETF was filed on June 6, 2024, approval could potentially be granted by late July 2024.
This proposal comes after ProShares recently introduced two Ethereum-linked ETFs: ProShares Ultra Ether ETF (ETHT) and ProShares UltraShort Ether ETF (ETHD), targeting daily returns of 2x and -2x the value of ETH, respectively. Both ETFs are scheduled to be listed on the NYSE on Friday, June 7.
In contrast to the United States, Hong Kong is considering the inclusion of staking in spot Ethereum ETFs. ProShares gained recognition for launching the first Bitcoin-linked ETF in 2021, the Bitcoin Strategy ETF (BITO), which invests in futures contracts. However, ProShares has not pursued a spot Bitcoin (BTC) ETF, unlike other major asset management firms such as Blackrock, Grayscale, and Fidelity.
It should be noted that approval for both filings is necessary for spot Ethereum ETFs to be officially traded in the market. The approval granted in May was specifically for the 19b-4 filing. Analysts predict that the final approval for these ETFs could be granted in July 2024.
These products are anticipated to offer investors increased flexibility and strategic options, allowing for more precise navigation of the volatile cryptocurrency market. Meanwhile, the Bitcoin ETF has attracted $2.4 billion in investments after experiencing consecutive inflows for the past 15 days, as reported by Senior Bloomberg ETF analyst Eric Balchunas in a recent post on X.