ETF firms race to be first in line for ether futures

investmentnews.com:

The race is on in the exchange-traded fund business to offer the first ether futures product.

Since last Friday, five providers have filed prospectuses with the Securities and Exchange Commission for a total of six products. Most of those filings came Monday and Tuesday, after Volatility Shares kicked off the frenzy by asking the regulator Friday for permission to launch its proposed product.

The recent filings are for the Grayscale Ethereum Futures, Bitwise Ethereum Strategy, VanEck Ethereum Strategy, ProShares Ether Strategy and ProShares Short Ether Strategy ETFs.

Companies began attempts to bring those products to the market in May, although they quickly pulled requests for approval when the SEC indicated it would reject them.

But how much investors want cryptocurrency futures ETFs is a question. So far, the handful of bitcoin futures ETFs on the market have not seen assets flood in.

Fund companies anticipate much more interest in spot bitcoin ETFs. The SEC has rejected at least 30 applications for those products since 2017, but things started to look promising for ETF providers in June. The regulator reportedly denied BlackRock’s application after just two weeks, which some have interpreted as a sign that it could soon start approving products. The regulator may have resolved more of its concerns with the broad category but has issues within individual ETFs.

“The industry has been lobbying the SEC for years, unsuccessfully,” said Thomas Gorman, partner at Dorsey & Whitney. “The difficulty for the SEC is not only analysis of whether something is a security … but historically, for the trading stuff, the real concern and the one that [Chair Gary] Gensler has successfully used for stopping the trading … is volatility.”