Ether ETFs in consideration as Grayscale, VanEck, and others submit applications to the SEC.

Six prominent asset management firms, including Grayscale and VanEck, have submitted new applications to introduce Ether (ETH) futures exchange-traded funds (ETFs) for customers in the United States.

Distinct filings presented to the U.S. Securities and Exchange Commission, as reviewed by Cointelegraph, detail applications from Grayscale, VanEck, Bitwise, Volatility Shares, ProShares, and Round Hill Capital.

We now have 5 separate #Ethereum futures ETF applications filed with the SEC. It would be interesting to know what has changed since May, aside from the fact that one entity (Volatility Shares) submitted an application on Friday. ProShares has opted for the inverse/short ETF. https://t.co/Qi8he0OwrU pic.twitter.com/qVVUwrUjOI

— James Seyffart (@JSeyff) August 1, 2023

Grayscale’s submission includes two proposals: a Grayscale Global Bitcoin Composite ETF and a Grayscale Ethereum Futures ETF. The Ether ETF from Grayscale will focus on futures contracts intended for trading on the Chicago Mercantile Exchange.

The SEC filing specifies that Grayscale’s fund will mainly invest in “front-month” Ether futures, which are contracts with “the shortest time to maturity.” Grayscale also mentioned its plan to “roll” Ether futures contracts prior to their expiration.

Volatility Shares has also detailed its intention to introduce an Ether futures ETF, directing its investments towards cash-settled contracts linked to ETH trading on the Chicago Mercantile Exchange. It is highlighted that the fund will not directly invest in Ether.

Volatility’s submission further indicates that it plans to engage in cash-settled Ether futures contracts as the buyer. In cash-settled futures markets, a counterparty typically pays cash to the buyer if the futures contract price increases, while the buyer compensates the counterparty if the price declines.

Related: BlackRock Bitcoin ETF could unlock $30 trillion worth of wealth, Bloomberg analyst says

VanEck’s application also suggests that its investment strategy will focus on ETH futures contracts to ensure that the value of ETH to which the fund is exposed equals 100% of its total assets.

The filing indicates that fluctuations in the value of ETH would lead to more significant changes in VanEck’s Ether ETF fund. This includes the possibility of “greater losses than if the Fund’s exposure to the value of ETH were unleveraged.”

ProShares provided an overview of their Short Ether Strategy ETF, which will invest in daily contracts aimed at profiting from declines in the S&P CME Ether Futures index. As described, the ProShares fund would benefit as much as the index loses on a particular day, and vice versa.

These applications follow a series of recent submissions from various mainstream asset management companies seeking to launch Bitcoin ETFs. The largest asset manager globally, BlackRock, is among those aiming to provide what would be the first Bitcoin (BTC) ETFs available in the country.

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