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US Regulators Approve First Ether ETFs, Marking Major Crypto Milestone
US regulators have approved the first exchange-traded funds (ETFs) that invest directly in ether, the world's second-largest cryptocurrency, providing a significant boost to the $2.4 trillion digital-asset industry.
The Securities and Exchange Commission (SEC) has given the green light to spot-ether ETF applications from 21Shares, Bitwise Asset Management, BlackRock, Invesco, Franklin Templeton, Fidelity Investments, and VanEck, according to regulatory filings and statements from asset managers on Monday. The SEC did not immediately respond to requests for comment.
This approval paves the way for imminent trading of these products, which industry proponents see as a sign of policymakers gradually embracing the virtual-currency boom. This follows the success of US-listed Bitcoin ETFs, which have attracted billions of dollars from both retail and institutional investors since January.
The approval also signals a softening in the regulatory climate, as fund issuers had been preparing for a potential rejection earlier this year. Optimism for approval surged in May when the SEC approved filings by venues such as Cboe Global Markets, Nasdaq, and the New York Stock Exchange to list the ETFs.
Several issuers, including BlackRock and Fidelity, plan to waive fees for an extended period once their funds begin trading.
Ether, the native token of the Ethereum blockchain, has surged over 50% year to date.
Bitcoin Inflows Surge
“Our clients are increasingly interested in gaining exposure to digital assets through exchange-traded products which provide convenient access, liquidity, and transparency,” said Jay Jacobs, US head of thematic and active ETFs at BlackRock, in a statement. “Ethereum’s appeal lies in its decentralized nature and its potential to drive digital transformation in finance and other industries.”
In late June, VanEck submitted a filing for a product investing in Solana, the fifth-largest cryptocurrency by market value, marking another effort by ETF issuers to capitalize on the growing demand for digital assets.
Last week, Bitcoin investment products attracted $1.27 billion as the cryptocurrency surged to its highest price in over a month, according to CoinShares data. This marks the fourth consecutive week of inflows, with Bitcoin ETFs adding over $3.1 billion. In the two weeks before this winning streak, Bitcoin ETFs saw outflows of $1.2 billion.
BlackRock and Fidelity’s Bitcoin funds saw the biggest gains last week, taking in $707 million and $244 million, respectively. Meanwhile, Grayscale’s fund continued to experience outflows, losing about $56 million.
Ether products brought in $45 million last week, following a gain of $72 million the week before. Alternative cryptocurrencies Solana, Litecoin, and Cardano also posted inflows of $9.6 million, $2.2 million, and $400,000, respectively.
