NYSE Arca filed an application to convert the Grayscale Ethereum Trust (ETHE) into an Ethereum ETF with the SEC. Grayscale CEO Michael Sonnenshein highlighted the importance of this step in bringing Ethereum within the US regulatory sphere. ETHE shares saw a 6.15% increase following the announcement of the conversion into an Ethereum ETF.
Grayscale Investments, one of the world’s largest asset management companies, has submitted a formal application to the US Securities and Exchange Commission (SEC) for approval to convert Grayscale Ethereum Trust (ETHE) into a fund Ethereum Spot Exchange Traded ETF (ETF).
According to an official press release on Monday, the Form 19b-4 application was filed by Arca of the New York Stock Exchange (NYSE) on October 2, following the approval of the first Ether ETF.
Grayscale’s Ethereum Trust officially debuted in March 2019 and has since grown to become a prominent player in the cryptocurrency investment space. In May 2019, the fund received a public listing and currently represents approximately 2.5% of the total circulating supply of Ethereum.
Grayscale to Offer Familiar Products to Customers
As the world’s largest Ethereum-based investment product, Grayscale’s Ethereum Trust manages nearly $5 billion in assets. In October 2020, it took a notable step to improve transparency by becoming a SEC reporting company, providing investors with direct information on the performance of its crypto investment products.
Additionally, Grayscale said that the Ethereum Trust is accessible to around 250,000 investors with more than 17 different crypto investment products. Currently, the company offers investors the opportunity to explore the crypto industry with 17 different offerings ranging from Grayscale Solana Trust (GSOL), to Zcash Trust (ZCSH) and Grayscale Ethereum Trust, which the company wants to transform into an ETF by counted.
If approved, the move marks an important step in providing investors with transparent and regulated access to cryptocurrencies within familiar product structures.
“At Grayscale, our unwavering commitment is to offer investors transparent and regulated access to cryptocurrencies through familiar product structures. As we submit the application to convert ETHE into an ETF, the next natural step in the evolution of the product, we recognize that this is an important moment to bring Ethereum further into the US regulatory perimeter,” said Grayscale CEO, Michael Sonnenshein.
Grayscale Wins Court Case Against the SEC
The company’s global head of ETFs, David LaValle, said the move is an important milestone for Grayscale as the company continues to build its best-in-class ETF team, product suite and capabilities, which serves investors as a globally respected. asset manager. The asset manager also reiterated the company’s commitment to guiding its crypto products through a deliberate four-phase lifecycle, with the fourth and final stage being the conversion to an ETF.
Meanwhile, the company’s request to convert ETHE into an Ether spot ETF comes after its recent victory against the SEC in August. A United States federal court ruled in favor of the company, asking the Commission to review its request to convert its Grayscale Bitcoin Trust (GBTC) into an ETF. Last year, the SEC rejected the application, saying the proposal did not meet anti-fraud and investor protection criteria.
It is no secret that US regulators have been against accepting a spot Bitcoin ETF, although the first approval could come early next year. Different world-renowned financial entities, including BlackRock, are on the waiting list to launch financial vehicles of this type. VanEck is preparing to launch the first Ethereum futures ETF this week.
By Audy Castaneda
