Pantera Eyes $100M of Spot Ether ETF Shares

Pantera Eyes $100M of Spot Ether ETF Shares

The venture capital giant is a major investor in crypto initiatives.

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

Crypto-focused Pantera Capital Management has signaled its interest in purchasing up to $100 million in shares in Bitwise Asset Management's proposed spot Ethereum ETF, according to a revised S-1 prospectus with the Securities and Exchange Commission that the issuer submitted Tuesday.

In the filing, Bitwise noted that the venture capital giant, an early and prolific investor in digital asset initiatives, had "indicated an interest in purchasing an aggregate of up to $100 million of Shares in this offering from Authorized Participants or in the marketplace through broker-dealers."

The Bitwise filing, however, noted that "indications of interest are not binding agreements or commitments to purchase," and that Pantera also had the option of purchasing "fewer or no Shares."

If Pantera follows through on its interest, the firm cannot sell its shares "in any open-market sale" for six months following its purchase. 

The revised filing comes as Bitwise and at least a half-dozen other issuers await an SEC decision on the proposed funds, which are based on the ongoing price of ether, the native cryptocurrency of the Ethereum smart contracts blockchain. 

Read More: Spot Ether ETFs Likely to Debut by July 2, Report Says

Last week, Bloomberg Senior ETF analyst Eric Balchunas forecast in a post on X that the funds might begin trading July 2, accelerating an earlier timeline for SEC approval. Balchunas noted that the agency's comments on issuers' initial S-1's were light. 

Approval of the S-1s has been considered a formality after the SEC greenlit a rule change that addressed agency concerns about potential fraud and market manipulation.

Bitwise Seed Money for Ether

In its updated filing, Bitwise also said that the firm had secured $2.5 million in seed money for purchasing ether. Such capital usually comes from an institutional investor. Last month, BlackRock said in its own revised S-1 application that it had received $10 million in seed money for its proposed spot Ethereum ETF. 

Ether, the second largest crypto by market capitalization behind bitcoin, was recently trading below $3,500, down about a half percentage point over the past 24 hours, according to crypto markets data provider CoinMarketCap. Despite a surge this week into the green, the token has fallen more than 8% over the past month, part of a widespread swoon in crypto asset investments. 

Bitcoin fell below $64,000, its lowest level since the first part of May, and flows to the widely successful spot bitcoin ETFs have slumped over the past two weeks, with net outflows on seven of the past eight days totaling nearly $950 million, according to U.K.-based asset manager Farside Investors. Those funds, which have generated $14.6 billion in inflows over their five-month lifespan, have helped address soaring demand for crypto assets. 

etf.com: GBTC flows

In an email, Bitwise said it couldn't comment beyond the public filing. etf.com also reached out to Pantera for comment. 

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

UPDATE (June 21, 2024, 5:05 p.m.): Adds Bitwise response. 

 

 

 

 

 

 

 

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.