Valkyrie, in a formal gesture, has lodged a petition with the United States Securities and Exchange Commission, beseeching the introduction of an exchange-traded fund (ETF) grounded upon the futures of Ether (ETH).
This stride comes as a subsequent progression from their preceding endeavors, which encompassed an alteration in their investment approach to accommodate a futures ETF connected to Bitcoin (BTC), all within the bounds of regulatory requisites.
Valkyrie’s submission exemplifies a meticulously calculated methodology: even though their primary thrust of investment persists within the domain of ETH futures contracts, they have chosen not to directly channel funds into Ether. Instead, their aspiration is to amass an array of diverse ETH futures contracts.
In addition, this new ETF plans to allocate its remaining assets in reliable avenues such as cash, cash equivalents, and high-quality securities, including US government-issued bills, notes, bonds, corporate debt securities, and money market funds.
A significant provision in Valkyrie’s proposal caps the ETF’s investment in Ether futures contracts at 8,000 contracts per month. This aligns with the position limits set by the reputable Chicago Mercantile Exchange.
It’s important to note that futures contracts formalize agreements to buy or sell an asset in the future at a predetermined price. If approved by the SEC, this ETF would enable investors to speculate on the future price movements of Ether.
Ether, the flagship cryptocurrency of the Ethereum blockchain, is primarily used for peer-to-peer transactions within its decentralized ecosystem. The application states:
Ether can be seen as a currency or digital commodity, depending on its distinct role in specific transactions. While several American and global retailers do accept Ether as payment, its use in commercial and retail settings remains somewhat limited. Furthermore, Ether’s potential as a store of value should not be underestimated, despite occasional price fluctuations.
The cryptocurrency investment community is buzzing with speculation and excitement. Valkyrie is not alone in its aspirations. Key players such as Grayscale, VanEck, Bitwise, Volatility Shares, ProShares, and Round Hill Capital have all submitted similar proposals to tap into the US Ether futures ETF market.
The surge of applications might be influenced by the prevailing belief that the US is close to approving a Bitcoin ETF. Prominent investment giants like BlackRock and Fidelity are eagerly awaiting regulatory approval.
Transformation is unfurling across the realm of crypto exchange-traded funds, and Valkyrie’s proposition for an ETF centered around Ether futures shines conspicuously. As the domain of cryptocurrency observes with eager expectation, the ultimate determination of the SEC stands poised to profoundly influence the trajectory of investments in the realm of digital currency.