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Ethereum Futures ETFs Gain Momentum with Latest from VanEck and ProShares

Published October 2, 2023 2:16 PM
James Morales
Published October 2, 2023 2:16 PM
Key Takeaways
  • The first Ether futures ETFs will begin trading on US exchanges this week.
  • VanEck and Proshares launched ETFs that will hold Ether futures on Monday after receiving permission from the SEC.
  • Valkyrie has also received the regulatory greenlight to diversify into Ether futures.

Nearly two years after it approved the first Bitcoin futures Exchange-Treaded Fund (ETF), it took the threat of a government shutdown to push the US Securities and Exchange Commission (SEC) into finally sanctioning the first Ethereum futures funds.

But finally, over the weekend, the SEC approved applications from three asset managers to hold Ether futures contracts in their ETFs.

ETH Futures Funds Expected to Begin Trading This Week

After the SEC scrambled to approve the first Ether futures ETF before a potential government shutdown, applications from VanEck, Valkyrie and ProShares were recently given the green light from the regulator.

On Monday, VanEck’s Ethereum Strategy ETF (EFUT ) and ProShares Ether Strategy ETF (EETH ) were officially registered with the Chicago Board Options Exchange (CBOE) and the New York Stock Exchange (NYSE) respectively.

ProShares has also registered two mixed Bitcoin and Ether futures funds—the Bitcoin & Ether Market Cap Weight Strategy ETF (BETH ) and the Bitcoin & Ether Equal Weight Strategy ETF (BETE ).

As the names imply, the former will hold BTC and ETH at a ratio that represents the size of their respective market capitalizations. Meanwhile, the latter will hold equal amounts of the two cryptocurrencies.

Assuming there are no unexpected hiccups in the listing process, the funds should begin trading on Tuesday.

Meanwhile, although Valkyrie initially intended to diversify its Bitcoin Strategy ETF (BTF) with Ethereum futures on Monday, the asset manager reversed course  on Friday.

Now, Valkyrie’s Bitcoin Strategy ETF “will not purchase ether futures contracts until the effectiveness of an amendment to the Fund’s registration statement,” the firm explained in an SEC filing.


Approvals Could Fuel an Influx of Institutional Investment

Since the SEC first approved ProShares Bitcoin Strategy ETF (BITO), the fund has gone on to become the largest Bitcoin-tracking ETF in the world, attracting over $1B in investment to date.

Meanwhile, several other funds that hold Bitcoin futures exposure, including those managed by VanEck and Valkyrie, have raised tens of millions each.

But until now, there were no equivalent options for investing in Ether futures. With the latest generation of ETH and mixed BTC and ETH funds set to begin trading this week, however, institutional investors could soon plow another $100B+ into crypto futures markets.

Commenting  on the launch of VanEck’s new ETF, the firm’s Head of Product Management Ed Lopez, said, “our legacy of offering investors access to important new segments of the capital markets continues with the launch of EFUT.”

“We’re very pleased to be bringing this new ETF to market and to be providing a key building block for a diversified digital assets portfolio for individuals and advisors,” he added.

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