Highlights:
- Bitwise files updated S-1 for Ethereum ETF shortly before the deadline, signaling readiness for launch.
- SEC approved 19b-4 forms for eight Ethereum ETFs in May, requiring issuers to resubmit S-1 filings by July 8.
- Analysts expect Ethereum ETFs to begin trading within the next two weeks.
On June 3, asset manager Bitwise filed an amended S-1 form with the United States Securities and Exchange Commission (SEC) for its proposed Spot Ethereum (ETH) exchange-traded fund (ETF), just ahead of the July 8 deadline. This move suggests that the product is almost ready for launch. Analysts predict that Ethereum ETFs, including Bitwise’s offering, could start trading within the next two w.
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No one really knows why the SEC is taking their sweet time with these, given how light comments were, these could have easily been trading by now. Could be one 'problem' issuer slowing down process or just summertime lazy/ppl on vaca. Not sure. That said, all indications launch…
— Eric Balchunas (@EricBalchunas) July 3, 2024
Bitwise’s updated S-1 form includes several revisions, notably waiving fees for the first $500 million in assets under management. However, the firm has not yet disclosed the fee structure applicable after surpassing this threshold. The filing did not specify a launch date for listing and trading on NYSE Arca but stated it would be “as soon as practicable after the effective date” of the registration.
Another ETF applicant, VanEck, also announced that fees would be waived initially. These actions indicate competitive strategies aimed at attracting initial investors. Waiving fees is intended to reduce entry barriers for new investors.
Two-step Process for Ethereum ETFs
The approval of the S-1 forms is the second step required for the ETFs to launch. The first step involved the approval of the applicants’ 19b-4 fillings. On May 23, the SEC approved 19b-4 forms from eight ETF issuers: Grayscale, Invesco & Galaxy, Bitwise, VanEck, BlackRock, Fidelity, Franklin, and ARK Invest & 21Shares. Moreover, issuers updated their S-1 registration statements on June 21, providing additional fees and seed funding details.
On June 29, ETF analysts James Seyffart and Eric Balchunas from Bloomberg reported that the SEC commented on the S-1 forms and requested that issuers address the comments and resubmit them by July 8.
Unfort think we gonna have to push back our over/under till after holiday. Sounds like SEC took extra time to get back to ppl this wk (altho again very light tweaks) and from what I hear next wk is dead bc holiday = July 8th the process resumes and soon after that they’ll launch… https://t.co/0ZQR7yiBLt
— Eric Balchunas (@EricBalchunas) June 28, 2024
During a Senate Banking Committee hearing on June 13, Gensler stated that he expected the commission to approve S-1 registration statements for asset managers “sometime over the course of this summer.” Moreover, on June 26, he said the process of launching the first spot of Ethereum ETFs in the US is “going smoothly” but did not provide a specific date.
Gensler elaborated:
“It’s really about the asset managers making the full disclosure so that those registration statements can go effective.”
Experts Confident in Near-Term ETFs Launch
Bloomberg ETF analyst James Seyffart noted on X that Bitwise has submitted an amended S-1 for their Ethereum ETF. He added that more amendments from other issuers are expected throughout the week and predicted that these ETFs could be listed later next week or the week of the 15th.
UPDATE: We've got another amended S-1 from @BitwiseInvest for their #Ethereum ETF. Expect more from other issuers throughout the rest of the week. We're thinking these things could potentially list later next week or the week of the 15th at this point. pic.twitter.com/xqVlt9lSGy
— James Seyffart (@JSeyff) July 3, 2024
Eric Balchunas expressed surprise at the regulatory body’s slow pace, suggesting summertime vacations as a possible reason. However, he confirmed that there are signs pointing to a launch happening this month.
Moreover, the president of The ETF Store, Nate Geraci, predicts that following the revised S-1 submissions, the SEC could give final approval by July 12. Thus, Geraci expects Ether ETF trading to commence on Monday, July 15.
Wen spot eth ETF?
BBG sticking w/ mid-July.
Amended S-1s due July 8th.
Potential final S-1s by July 12th.
Would theoretically mean launch week of July 15th.
via @emily_graffeo @olgakharif pic.twitter.com/NG8xhtCP21
— Nate Geraci (@NateGeraci) July 3, 2024
Spot Ethereum ETFs Launch Expected to Boost ETH Performance
In a July 2 report, K33 analysts David Zimmerman and Vetle Lunde predicted that the launch of ETH ETFs in the US could boost ETH’s performance relative to Bitcoin in the weeks following their launch. Analysts said the ETFs are like a “golden egg” for Ethereum’s price. Meanwhile, Bitcoin could face selling pressure as $8.5 billion worth of BTC is returned to creditors of the defunct Mt. Gox exchange starting this week.
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