Digital currency investment firm Grayscale has submitted a new application for an Ethereum Futures Exchange Traded Fund (ETF) with the US Securities and Exchange Commission (SEC).
On September 19, Grayscale proposed the listing and trading of shares for the Grayscale Ethereum Futures Trust ETF under NYSE Arca Rule 8.200-E.
This proposal adheres to the provisions of the Securities Exchange Act of 1934 and rule changes filed by the New York Stock Exchange with the SEC. The ETF is managed by Grayscale Advisors, also referred to as the "sponsor" in the filing.
The document mentions that the sponsor is in the process of registering as a commodity pool operator with the Commodity Futures Trading Commission and is in the process of becoming a member of the National Futures Association. Grayscale Advisors has also enlisted Videnct Advisory as a subadviser to act as the trust's commodities Transaction Advisor.
The Grayscale Ethereum Futures Trust is designed to maintain its holdings of Ethereum futures contracts with "substantially constant expiration profiles" and will not hold futures positions until cash settlement.
Interestingly, the nature of the Ethereum futures contracts in the ETF doesn't necessitate the use of an Ethereum custodian. Instead, the trust will deposit an initial margin amount to initiate an open position in a futures contract.
Grayscale's move follows similar applications for Ethereum futures ETFs filed by several other companies, indicating growing interest in Ethereum-based ETFs. In August, the SEC allowed the launch of the first ETFs based on Ethereum futures, sparking optimism in the Ethereum market.
Notably, Grayscale recently achieved a partial victory in its battle with the SEC regarding the conversion of its Grayscale Bitcoin Trust (GBTC) into a listed spot Bitcoin ETF. Although the outcome of the Grayscale Spot Bitcoin ETF listing remains uncertain, the decision to review its application was seen as a positive development by the community.
