According to a Form S-1 filed with the US Securities and Exchange Commission, the asset manager VanEck Digital Assets has applied for an Ethereum Exchange Traded Fund (ETF). Called VanEck Ethereum Trust, it would be traded on the Cboe BZX exchange if approved.
The investment product would track the MVSI CryptoCompare Ethereum benchmark rate and hold the physical ETH. VanEck has appointed the Delaware Trust Company as custodian.
According to the document, the custodian will hold the physical ETH. If the cryptocurrency trades down, VanEck will return or sell more shares. The sale of the ETH is excluded. According to the document:
The investment objective of the trust is to reflect the performance of the MVIS® CryptoCompare Ethereum Reference Rate less the cost of operating the trust. In order to achieve its investment objective, the Trust will hold Ether (“ETH”) and value its shares daily on the basis of the stated MVIS® CryptoCompare Ethereum reference interest rate.
The asset manager VanEck has also applied for a Bitcoin ETF with the SEC. In the past, hers and the rest of these petitions have been rejected by the regulator. However, the current seems different and more promising.
Gary Gensler, former MIT professor with a course on cryptocurrencies and blockchain, was confirmed as chairman by the U.S. Senate. His position appears to be more flexible and pragmatic than his predecessors. The regulator will evaluate VanEck's petition and decide for or against it. The SEC has a longer period to issue its decision, which has always been applied in the past.
Canada's Ethereum ETF with record volume
Meanwhile, there is a crypto craze for crypto ETFs in Canada, said Erick Balchunas, senior ETF analyst for Bloomberg Intelligence. The country has approved several Bitcoin and Ethereum ETFs and their trading volume has skyrocketed in recent weeks. Balchunas said:
Canada is crazy about crypto. I thought the story was the record volume of $ ETHX, but no, the 3iQ Bitcoin ETF came out of nowhere to trade for $ 200M, most in the country. Probably (another) massive creation. It is already up to USD 600 million per year (equivalent to USD 16 billion in US dollars).
Grayscale's ETH-based investment product, the Grayscale Ethereum Trust (ETHE), is what investors in the US come closest to an ETF. Last week, the volume of this product surpassed that of the Grayscale Bitcoin Trust (GBTC), Balchunas said.
Canada's ETH ETF with record volume. Source: Eric Balchunas – Bloomberg
This suggests that ETH has attracted the attention of institutional investors. The price reacted accordingly and ETH reached a new all-time high in the same period.
ETH is trading at USD 3,544 with a gain of 1.7% on the daily chart. In the weekly and monthly charts, the ETH achieved a profit of 27.6% and 78.2% respectively.
ETH moved sideways in the lower periods. Source: ETHUSD Tradingview