Highlights:
- Nasdaq proposes options for BlackRock’s Ethereum ETF to expand investment tools.
- ETHA’s market share has tripled to 9%, with AUM surpassing $594 million.
- SEC’s decision on ETHA options trading is expected by April 2025, according to Seyffart.
On August 6, the Nasdaq International Securities Exchange submitted a proposal to the US Securities Exchange and Commission (SEC) to introduce the options trading for BlackRock’s Ethereum ETF, iShares Ethereum Trust (ETHA). BlackRock’s ETHA and eight others were approved in May and began trading last month. ETHA is the only Ethereum ETF that Nasdaq lists, while NYSE Arca and Cboe list the others.
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BlackRock, Nasdaq make the push for options on spot Ethereum ETF https://t.co/gmGG6wELZG
— The Block (@TheBlock__) August 6, 2024
The filing indicates that the proposed iShares Ethereum Trust will exclusively hold ETH, managed by Coinbase, while the Bank of New York Mellon will hold cash assets. Furthermore, the document affirmed that it would not participate in Ethereum staking for additional income. According to Nasdaq, the initiative aims to broaden the range of investment tools for Ethereum and increase accessibility to crypto in traditional markets.
The filing explains that these shares do not directly represent an investment in Ethereum. However, they offer an alternative way for investors to gain exposure to Ethereum through the public securities market, which may be more familiar to them.
The filing submitted to the SEC reads:
“The Exchange believes that offering options on the Trust will benefit investors by providing them with an additional, relatively lower cost investing tool to gain exposure to spot ether as well as a hedging vehicle to meet their investment needs in connection with ether products and positions.”
SEC’s Decision on ETHA Options Trading Expected by April 2025
According to James Seyffart, an ETF analyst at Bloomberg Intelligence, the SEC has 21 days to provide comments on the matter. However, he noted that the final deadline for a regulatory decision is “likely to be around” April 9, 2025.
Notably, the SEC is not the only regulator that must approve Nasdaq and BlackRock’s joint move. As Seyffart highlighted, the Commodity Futures Trading Commission (CFTC) and the Office of the Comptroller of the Currency (OCC) also need to give their approval.
Nasdaq and BlackRock's filing to add options on Ethereum ETFs has hit the SEC site. Final SEC decision on this from SEC likely to be around April 9th, 2025.
(SEC is not the only decision maker on adding options here. Also need signoff from OCC & CFTC) https://t.co/K4HunUPp7S pic.twitter.com/5kQH0mljTz
— James Seyffart (@JSeyff) August 6, 2024
BlackRock Ethereum ETF’s Rising Dominance
BlackRock’s ETHA has seen a steady increase in inflows. Since the launch of spot Ethereum ETFs in the US on July 23, ETHA’s market share has tripled from 3% to 9%. According to DefiLlama, ETHA’s assets under management (AUM) are now over $594 million. However, Grayscale’s converted ETF, ETHE, still holds a significant lead. ETHE’s AUM stands at $4.9 billion, nearly nine times the size of ETHA.
Despite global macro headwinds this week, spot Ethereum ETFs have seen strong inflows, with BlackRock’s ETHA leading the way. On August 6, BlackRock’s spot Ethereum ETF recorded $109.9 million in inflows, bringing its total inflows to $869.8 million since its launch on July 23. According to Farside Investors, it was the third-largest flow day for the iShares Ethereum Trust, as investors aimed to take advantage of Ether’s 18% price drop on August 5.
ETF Store President Nate Geraci noted that the BlackRock Ethereum ETF could rank among the top 10% of ETF launches in 2024 due to its significant inflows. BlackRock’s Bitcoin ETF (IBIT) is already among the top ten ETF launches this year. Additionally, Bitcoin ETF outflows have been declining, suggesting positive developments may be on the horizon.
After “Crypto Black Monday” (lol) where ETHA took in nearly $50mil…
It vacuums-up approx $110mil today.
That $160mil alone would put it in top 10% of all new ETFs this yr.
ETHA now nearing $900mil inflows 2 weeks in.
Top 6 ETF launch in 2024 (4 of 5 others = spot btc ETFs). https://t.co/JtEIXcu7Yc
— Nate Geraci (@NateGeraci) August 7, 2024
The SEC has not yet authorized options trading on spot Bitcoin ETFs, which were listed in January and now hold around $50 billion in BTC. In July, the SEC told the options exchanges, including Nasdaq ISE, that it needed more time to decide on listing options for spot BTC ETFs.
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