BlackRock Says $10M Seed Money Planted For Ether ETF

BlackRock Says $10M Seed Money Planted For Ether ETF

Asset manager also chooses ETHA for ticker for spot fund, according to updated filing.

ETF.com
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Contributing Editor
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Reviewed by: etf.com Staff
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Edited by: Ron Day

BlackRock Inc. has updated its registration statement for a proposed spot Ethereum exchange traded fund, the next major step toward potential approval of the new fund.

In a filing Wednesday with the Securities and Exchange Commission, the world's largest asset manager unveiled the ticker name, ETHA, and said that "a seed capital investor" had purchased 400,000 shares at $25 per share on May 21—a total of $10 million in the proposed ETF.  Upon approval, shares in ETHA would be redeemable in cash or ether. 

The SEC must approve S-1 statements for the funds to begin trading, a step that's considered a formality. 

Read More: SEC Changes Ethereum Rule, Sets Stage for ETF Approval

The amended S-1 follows just a week after BlackRock and eight other issuers received a surprise SEC approval for a rule change that significantly increased the likelihood the agency would greenlight the ETFs, which are based on the ongoing price of ether. Ether, the token of the Ethereum smart contracts blockchain, is the second largest cryptocurrency by market capitalization behind bitcoin.  

Spot Ether Funds in June?

Bloomberg Intelligence Senior ETF Analyst Eric Balchunas called the filing "a good sign" in a post on the social media platform X/Twitter, writing that other applicants would likely file their amended S-1s "soon," and that spot ether funds might begin trading by the end of June. 

"Prob see the rest roll soon," Balchunas wrote. "Then prob one more round of fine-tune comments from Staff. End of June launch a legit possibility altho keeping my o/u date as July 4th."

Ether was recently trading at about $3,770, down roughly half percentage point over the past 24 hours, according to digital assets data provider CoinMarketCap. It has risen nearly 26% since the end of April with much of those gains occurring the past two weeks amid soaring optimism about spot Ethereum ETF prospects for SEC approval.

The VanEck Ethereum Strategy ETF (EFUT) and other ether futures-focused funds were mildly in positive territory on Thursday. 

Read More: ETF Spotlight: EFUT Climbs Amid Ether Surge

etf.com Senior Analyst Sumit Roy said that the updated prospectus "shows that the fund manager is engaging with the SEC—dotting the i’s and crossing the t’s—which are the normal steps taken before a fund launch."  

VanEck, Fidelity, Bitwise, Ark 21 Shares, Grayscale are other issuers with spot Ethereum ETF proposals before the SEC. Those applications underscore issuers' efforts to meet surging market demand for digital asset-based investments and heightened optimism about their potential. Eleven spot bitcoin ETFs that won approval earlier this year have generated more than $13.7 billion in inflows and now control about $55 billion in assets. 

In a speech at the CoinDesk Consensus crypto conference in Austin, Texas, Goldman Sachs' global head of crypto Mathew McDermott, called the spot bitcoin ETF approval a "big psychological turning point."

James Rubin is a contributing editor for etf.com, where he produces the Morning Exchange and Weekly Exchange newsletters. A longtime financial writer, editor and book author, he formerly held positions as a news and markets editor for the Americas at CoinDesk, where he focussed on cryptocurrencies. 

He provided editorial guidance for a Wall Street Journal best-selling book on Bitcoin and oversaw a startup newsroom focused on digital financial assets. He has edited for TheStreet and Unchained, where he wrote daily news stories about the trial of fallen crypto entrepreneur Sam Bankman-Fried. His writing has also appeared in The Hollywood Reporter, Forbes.com, AdWeek, Bankrate, The Financial Brand and The Wall Street Journal. He has also written for Forbes Insights and the Economist Intelligence Unit, including papers presented at World Economic Forums in Davos and Mumbai. 

James is the co-author of The Urban Cyclist’s Survival Guide (Triumph Books) and has been interviewed about bike safety on a number of NPR affiliates. In a prior career, Rubin was a world-ranked tennis player, once competing in Wimbledon’s qualifying rounds. He speaks fluent German and is a graduate of the Columbia University Graduate School of Journalism and received his BA at Columbia University.