Asset Managers Amend Spot ETH ETF Filings Ahead of SEC Decision

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In the latest development surrounding spot Ether exchange-traded funds (ETFs) in the United States, three major asset managers have amended their 19b-4 filings with the Securities and Exchange Commission (SEC). 

The amendments, filed on May 22, involve asset managers BlackRock, Grayscale, and Bitwise, and are a critical step towards potentially listing and trading spot Ether ETFs on US exchanges.

Asset Managers Amend Filings

The amendments primarily address the removal of provisions related to staking, a process integral to Ethereum’s proof-of-stake validation system. In its filing with the Nasdaq Stock Market, BlackRock clarified that neither the Trust, the Sponsor, the Ether Custodian, nor any other associated party would engage in staking activities. 

The filing stated, “Neither the Trust, nor the Sponsor, nor the Ether Custodian […] nor any other person associated with the Trust will, directly or indirectly, engage in action where any portion of the Trust’s ETH becomes subject to the Ethereum proof-of-stake validation or is used to earn additional ETH or generate income or other earnings.”

Asset Managers Optimistic as Deadlines Approach

Similarly, asset managers Grayscale and Bitwise submitted their amendments to the New York Stock Exchange Arca, reflecting the same changes. These amendments come as the SEC’s decision deadline for VanEck’s application approaches on May 23. The regulator’s ruling could set a precedent for the other pending applications.

On May 21, prominent asset managers Fidelity, VanEck, Franklin Templeton, Invesco Galaxy, and ARK 21Shares also submitted similar amendments, eliminating staking provisions from their applications. The SEC’s impending decision has generated significant anticipation within the crypto community, especially given the broader context of ongoing legislative efforts to clarify the SEC’s role in digital asset regulation.

US Approves FIT21 Regulation

At the time of publication, the US House of Representatives was debating the Financial Innovation and Technology for the 21st Century Act, which aims to define the regulatory roles of the SEC and the Commodity Futures Trading Commission (CFTC) more clearly. 

This legislative effort underscores the growing need for a well-defined regulatory framework as digital assets continue to evolve and integrate into mainstream financial markets.

VanEck ETH ETF on DTCC

The Depository Trust and Clearing Corporation has listed VanEck’s Ether ETF under the ticker symbol ETHV. While this is a positive indication, it is not a definitive sign of approval. The SEC’s decision on these spot Ether ETFs is eagerly awaited, particularly after its approval of spot Bitcoin investment vehicles earlier this year.

The outcome of these filings and the subsequent SEC decision will have far-reaching implications for the digital asset market. Approval could signal a new era of institutional acceptance and regulatory clarity for Ether and other digital assets. However, the removal of staking provisions also highlights the regulatory challenges and complexities involved in integrating innovative blockchain features within traditional financial frameworks.

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