Bitwise files application for Ethereum ETF

Bitwise has filed an application with the Securities & Exchange Commission (SEC) for an Ethereum exchange traded fund (ETF). The company already offers a bitcoin ETF with the trading ticker BITB.

Bitwise en Ether ETF

An ETF can be described as an investment fund whose shares are listed on a stock exchange. The goal is to track the price of the underlying asset, in this case bitcoin. This way, investors have exposure to bitcoin without having to store the asset themselves.

Bitwise wants to further expand its offering with Ethereum, the second cryptocurrency on the market. They do this not only with a new ETF application, but also by offering an Ethereum futures ETF, known as Bitwise Ethereum Strategy ETF (AETH). They follow, among others, BlackRock and Fidelity.

Unlike some competitors, Bitwise does not allow for ‘staking’, which is possible with Ark 21Shares and Fidelity. Staking is a process where users stake their ether as part of the network’s consensus mechanism, called Proof of Stake (PoS). By attaching their ether to the network, we are immediately validators of the network.

Bitwise wants to list the proposed Ethereum ETF on the New York Stock Exchange. No trade sticker has been announced yet.

Cooled down

Despite the success of the bitcoin ETFs in America, there is still a lot of uncertainty about the arrival of an ether ETF. Existing providers such as BlackRock and Fidelity also want to jump on the ether train, because they are gaining a lot of traction with the bitcoin proposition. However, it took years for the SEC to approve a bitcoin ETF and the question is whether an ether ETF will suffer the same fate. The previous optimism has cooled because a decision has been postponed. The next decision round will follow at the end of May.

This slow pace is a contrast to the success of the bitcoin ETF. Nevertheless, experts believe the timing of the ETF’s launch could impact its success, with a later launch benefiting from increased market readiness.