BlackRock and Grayscale have filed amendments to their spot Ethereum exchange-traded fund (ETF) applications after the SEC delayed its decision on multiple proposals for Ethereum ETFs earlier this week.
In an updated 19-b 4 filing, investment giant BlackRock introduced a proposed rule change to its plan to list and trade shares in the iShares Ethereum Trust. The change calls for creation and redemptions to be cash-based rather than in-kind, noting that "the authorized participants will deliver only cash to create shares and will receive only cash when redeeming shares." Further, authorized participants will not "directly or indirectly purchase, hold, deliver, or receive" Ethereum as part of the creation or redemption process.
The update mirrors the structure of other Ethereum ETF applications, as well as the already approved U.S. spot Bitcoin ETFs.
Grayscale, meanwhile, has filed an S-3 registration statement as part of its bid to turn its existing Grayscale Ethereum Trust into a spot Ethereum ETF. Because the Grayscale Ethereum Trust is already registered with the SEC, the asset manager could file a Form S-3 rather than a Form S-1.
The proposed Grayscale Ethereum ETF would list its shares on NYSE Arca, trading under the ticker ETHE.
Simultaneously, Grayscale filed a Form S-1 registration document for a mini Ethereum ETF, also trading on NYSE Arca under the ticker ETH. The move mirrors its proposed listing of a mini Bitcoin ETF (BTC) with lower fees than its flagship GBTC product, which has seen billions of dollars in outflows since its launch in January.
The flurry of filings comes on the heels of the SEC's announcement yesterday that it would delay its decision on spot Ethereum ETF proposals from Grayscale Investments and Wall Street giant Franklin Templeton.
The SEC and Ethereum ETFs
After the SEC reluctantly approved multiple spot Bitcoin ETFs in January, hopes were initially high that the regulator would swiftly rubber-stamp approval of spot Ethereum ETFs.
But optimism among ETF watchers has dwindled. Earlier this month, investment bank JP Morgan predictied that there was "no more than a 50% chance of spot Ethereum ETF approval by May."
Bloomberg Intelligence, meanwhile, doubled down on its prediction that there was no more than a 25% chance of spot Ethereum ETFs being approved by the upcoming May 23 deadline. "That said, this definitely tells me that issuers aren't giving up the fight," Bloomberg ETF analyst James Seyffart tweeted following the filings.
Edited by Andrew Hayward