ETF Based on Ethereum: Is It a New Era of Investment in Crypto?

Exchange Traded Fund based on cryptocurrencies is one of the most discussed topics of 2021. The world has already seen Bitcoin ETFs, but Ethereum-based ETFs could also appear soon. Let’s find out what this will lead to and whether there will be funds based on other coins.

What exactly is ETF?

Exchange Traded Fund (ETF) is an index fund which can be purchased or sold on an exchange. This instrument has been existing for a long time in the field of traditional finance as a tracker of indexes, commodities, or other assets. On crypto exchanges, ETF operates as a certificate for a portfolio of currencies.

How the first ETFs appeared?

From 2018 to 2021, many attempts were made to launch Bitcoin ETFs. US companies have been filing applications for it to the Securities and Exchange Commission. Among them were such large companies as VanEck, Gemini, SolidX and Cboe. But until March 2021, the SEC rejected all applications. Now another document is under consideration, and a decision will be made by the end of April.

Who will run the first Ethereum ETF?

The first Ethereum-based fund is likely to appear in Canada as well. There are two applications currently pending with the Ontario Securities Commission (OSC).

  • CI Financial: the application filed at the end of February. The consultant is Mike Novogratz’s Galaxy Digital cryptocurrency bank.

How could Ethereum ETF change the crypto world?

ETFs are expected to bring large investors into the cryptocurrency market, as well as boost the number of average ones. The more different funds appear, including those based on altcoins, the more instruments for investors.

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