Grayscale seeks to convert its Ethereum Trust to an ETF

Filing comes after the firm’s August court win against the SEC, and as fund groups get set to offer the first ether futures ETFs

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Grayscale Investments wants to morph its Ethereum Trust into an ETF, a move that parallels a proliferation of ETH-related fund applications.

The news came in a Monday filing by NYSE Arca, the exchange that would list the planned fund. Shares of the Grayscale Ethereum Trust (ETHE) currently trade on the OTC Markets Group under the ticker ETHE. 

ETHE has about $5 billion in assets under management. The trust’s shares were trading at about a 31% discount to its net asset value on Friday, according to YCharts.com

“As we file to convert ETHE to an ETF, the natural next step in the product’s evolution, we recognize this as an important moment to bring Ethereum even further into the US regulatory perimeter,” Grayscale CEO Michael Sonnenshein said in a statement. 

The filing follows Grayscale’s court win against the Securities Exchange Commission over its proposed conversion of its Bitcoin Trust (GBTC) to an ETF. 

Judges ruled in that case that the SEC’s denial of that application — but its allowance of bitcoin futures ETFs — was “arbitrary and capricious.”

Though the decision doesn’t force the SEC to approve GBTC’s conversion to an ETF, it prevents the regulator from denying such an application on the grounds previously used.  

Firms such as Ark Invest, 21Shares and VanEck filed last month to launch spot ether products on the heels of that ruling.

The NYSE Arca filing also comes as various fund groups — including VanEck, ProShares and Bitwise — said Monday they were set to launch the first ETFs investing in ether futures contracts.

Read more: SEC now ready to consider ETH futures ETFs, sources say — but what’s changed? 

“This filing is another important milestone as Grayscale continues to build its best-in-class ETF team, product suite, and capabilities — serving investors as a globally respected asset manager with unmatched crypto expertise,” Grayscale ETF head David LaValle said in a statement.


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