Kryptoin Investment Advisors has submitted an application to the US Securities and Exchange Commission (SEC) to launch an Ethereum-ETF. The structure is designed for direct investment in digital assets.
According to the application, the Kryptoin Ethereum ETF Trust will provide clients with access to an instrument that “reflects the actual state of the market”, the second largest cryptocurrency by capitalization. Its value will be calculated based on the reference index CF Ether-Dollar US Settlement Price from the Chicago Mercantile Exchange.
If approved, the product will be listed on the Chicago Board Options Exchange. Gemini Trust Company, LLC will be the custodian of the fund.
Unlike other companies that have filed applications in recent weeks under the Investment Companies Act of 1940, Kryptoin is focusing on a document from the previous decade.
“The trust is not registered as an investment company under the 1940 Act, [Kryptoin] does not feel obliged to register a structure under it. Consequently, shareholders will not receive the regulatory protection provided to investors in investment companies, ”the document says.
The company's Ethereum-ETF will work in the same way as the Bitcoin exchange-traded fund offered to it, which it applied for registration back in 2019. In April 2021, Kryptoin updated the form. In June, the SEC extended the deadline for its consideration.
Earlier, the head of the Commission, Gary Gensler, said that this 1940 Act provides for more reliable measures to protect investors than the 1930 Act. He stressed that the fund that meets the requirements of the regulator can be approved.
After that, at least four companies - Invesco, ProShares, VanEck and Valkyrie Investments - sent applications for ETF registration, taking into account Gensler's recommendations. The latter's chief investment officer, Stephen McClurg, emphasized that Gensler's comment suggests that the pure spot ETF will not be approved anytime soon.
Recall that in May, the financial giant WisdomTree filed an application for registration of the Ethereum-ETF with $ 70 billion in assets under management.