Asset management firm Valkyrie has filed for an Ether (ETH) futures exchange-traded fund (ETF) with the United States Securities and Exchange Commission. According to Aug. 16 documents, the application is an addition to the company’s previous move to change its investment strategy for a Bitcoin (BTC) futures ETF in line with the regulator.
As per the application, the fund will not directly invest in Ether but will seek to purchase a number of ETH futures contracts. Ether is the native coin of the Ethereum blockchain, used for peer-to-peer transactions within the decentralized network.
“Ether may be regarded as a currency or digital commodity depending on its specific use in particular transactions. Ether may be used as a medium of exchange or unit of account,” reads the document, which adds that “although a number of large and small retailers accept ether as a form of payment in the United States and foreign markets, there is relatively limited use of ether for commercial and retail payments. Similarly, ether may be used as a store of value, […] although it has experienced significant periods of price volatility.”
Valkyrie just filed for an Ether Futures ETF, which is in addition to their 497 filing to do name/strategy of $BTF to Bitcoin + Ether Futures to get out early. Perhaps this is sign SEC not letting them do the ‘ole $MJ maneuver, not sure.. ht @NateGeraci pic.twitter.com/OeyGuyJP3y
— Eric Balchunas (@EricBalchunas) August 16, 2023
In addition to the investments in Ether futures, the ETF will invest its remaining assets directly in cash, cash-like instruments or high-quality securities, which include bills, notes and bonds issued by the U.S. government, along with money market funds and corporate debt securities.
According to Valkyrie’s application, the ETF investment in Ether futures contracts will be limited to 8,000 contracts per month, in compliance with position limits established by the Chicago Mercantile Exchange. Futures contracts are standardized agreements to buy or sell an asset at a future point at a specific price. If approved, investors will be able to wager on future prices of Ether through the ETF.
Cointelegraph previously reported that at least six other major asset managers have similarly filed to offer an Ether futures ETF to U.S.-based customers, including Grayscale, VanEck, Bitwise, Volatility Shares, ProShares and Round Hill Capital. The wave of applications follows high expectations that U.S. authorities will soon approve a spot Bitcoin ETF in the country, with multiple investment firms seeking a regulatory green light, including Wall Street giants BlackRock and Fidelity.