21Shares and Ark file for first US spot ether ETF

investmentnews.com:

Crypto exchange-traded-products issuer 21Shares and Cathie Wood’s Ark Investment Management are seeking to offer the first U.S. ETF that invests directly in ether. 

The firms are hoping to debut the ARK 21Shares Ethereum ETF, according to a Wednesday filing with the Securities and Exchange Commission. Their application is the first of its kind and, if offered, would mark the first U.S. exchange-traded fund that’s physically backed by the second-largest cryptocurrency after bitcoin. The fund would trade under the ticker ARKE. 

Wednesday’s filing comes as the race to win approval for the first U.S. spot bitcoin fund intensifies. Regulators have cited concern about fraud and price manipulation while rejecting numerous applications over the past decade. But a recent court victory by Grayscale Investments against the SEC in its fight to convert its bitcoin trust to an ETF is being seen by some analysts as eventually paving the way for a fund.

“There’s been so much regulatory controversy about a bitcoin spot ETF that I guess many people thought it was a step too far — but we don’t,” Ark’s Wood said. “And it’s always nice to be first.”

“There have been considerable market developments over the last couple of weeks — Grayscale winning their lawsuit being one of them, some of the statements out of the judiciary around how they’re assessing different products, as well as, quite frankly, the fundamentals in the market,” Ophelia Snyder, co-founder and president of 21Shares, said of the timing for the filing. “If you look at the state of ethereum markets today, especially around things like the futures products, you’re starting to get to a place where those markets are much more established.”

21Shares and ARK, which have been