Public documents show the wealth manager Vaneck has applied for an ethereum based exchange-traded fund (ETF). Vaneck Digital Assets’ Form S-1 filing with the Securities and Exchange Commission (SEC) was filed on May 7, while the company’s bitcoin-based ETF is still under review.
While Waiting for Approval for Its Bitcoin ETF, Vaneck Files With the SEC for an Ethereum Fund
The ETF and mutual fund manager Vaneck and its digital assets management subsidiary have filed with the SEC on Friday for an ethereum-based ETF. The filing mentions the ETF will be called the “Vaneck Ethereum Trust,” and the company hopes to list shares on the Cboe BZX Exchange. So far in the United States, the SEC has yet to approve a bitcoin-based ETF filing, but there’s been a flurry of applications in 2021 with Vaneck’s bitcoin ETF included.
Cboe is also mentioned as the listing exchange for Vaneck’s BTC application. The trust will hold ethereum (ETH) as share value will be based on the MVIS Cryptocompare Ethereum Benchmark Rate. MVIS or MV Index Solutions Gmbh is an affiliate of Vaneck Digital Assets. Essentially, if the ETH-based ETF is approved, retail and institutional investors can gain exposure to ETH.
“The trust provides direct exposure to ETH and the shares of the trust are valued on a daily basis using prices drawn from a carefully evaluated group of exchanges selected by MVIS,” the Vaneck filing notes. The wealth manager adds:
The trust provides investors with the opportunity to access the market for [ethereum] through a traditional brokerage account without the potential technical barriers to entry or risks involved with holding or transferring [ethereum] directly, mining it, or acquiring it from an exchange, as referenced above.
Risk Section Mentions 2017’s Highs and the Following Crypto Winter
In the risk section of the Form S-1 filing, Vaneck mentions that ETH experiences “extreme volatility in recent periods and may continue to do so.” The company mentions the 2017 bull run and says that a myriad of observers called the rise of ETH a “bubble.”
“These increases were followed by steep drawdowns throughout 2018 in trading prices for ETH, and ETH prices remained depressed in 2019,” Vaneck stressed.
ETH could be “still be experiencing a bubble” Vaneck emphasizes in the filing and it may see a bubble period again. Ethereum markets have been on a tear in recent months and touched an all-time high on Thursday reaching $3,575 per unit. The blockchain asset ether has gained a whopping 1,572% against the U.S. dollar during the last 12 months.
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