Nasdaq has submitted an application to the US Securities and Exchange Commission (SEC) seeking approval to list an Ethereum exchange-traded fund (ETF) offered by asset manager Hashdex. This ETF, called the Hashdex Nasdaq Ethereum ETF, plans to integrate Ethereum spot holdings and futures contracts into its portfolio, aiming to pioneer a fresh approach to cryptocurrency investing while operating within regulatory boundaries.
Toroso Investments, a registered commodity pool operator with the Commodity Futures Trading Commission (CFTC) and a member of the National Futures Association, is overseeing the Hashdex Nasdaq Ethereum ETF, which is the first Ethereum futures ETF to be filed under Act 33.
The surge in cryptocurrency ETF applications has revolved around whether proposed funds intend to include futures contracts or spot assets, with the SEC approving the former but not the latter. Fund managers are now exploring middle-ground options, testing their prospects in the current regulatory landscape . The primary objective of the Hashdex Fund is to ensure that its shares accurately reflect daily fluctuations in the Nasdaq Ether Reference Price. To achieve this, the fund intends to allocate its assets across ether, ether futures contracts traded on the Chicago Mercantile Exchange, and cash and cash equivalents. Nasdaq's filing states that the fund will not hold 100% spot Ethereum to mitigate potential price manipulation risks in the spot market. Instead, it will maintain a mix of spot Ethereum, Ethereum futures contracts, and cash.
Hashdex's approach differs from recent filings, such as those by Ark Invest and 21Shares, which applied for spot ether ETFs. Hashdex does not rely on Coinbase to monitor the sharing protocol but instead sources spot Bitcoin from physical exchanges within the CME Markets. It's worth noting that the SEC has postponed decisions on all spot cryptocurrency fund applications received so far.
