BlackRock and VanEck Submit Updated Ethereum Spot ETF Filings to Commence Trading Very Soon

• BlackRock and VanEck have amended its S-1 filing with the SEC for its Ethereum ETF.

• Erick Balchunas predicts the Ethereum ETFs could be approved by late June or early July.

Asset management giant BlackRock has made a significant move in its bid to launch an Ethereum spot ETF. The firm has amended its S-1 filing with the U.S. Securities and Exchange Commission (SEC), signaling progress in the regulatory approval process.

The amended S-1 filing from BlackRock disclosed information about its seed capital investor, which is essential for the fund to start trading. On May 21, a BlackRock affiliate firm committed to purchasing $10,000,000 in shares and took delivery of 400,000 shares at a per-share price of $25.00. This financial backing is critical for the ETF’s operational commencement. The ETF will trade under the ticker “ETHA.” On the same day the ETFs received approval, VanEck promptly submitted an amended S-1 form. 

Analysts Anticipate Ethereum ETF Approvals

Bloomberg ETF analyst Eric Balchunas highlighted this as a positive sign, noting the possibility of seeing other filings progress soon.  Balchunas said that he doubts there will be more adjustments to the comments by SEC, yet he underlined that the launch late in June is possible. He estimated the approval odds for around July 4, though he mentioned that an earlier approval remains a “long shot.”

Good sign. Prob see rest roll in soon. 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 https://t.co/WymshkTvat

— Eric Balchunas (@EricBalchunas) May 29, 2024

Bloomberg ETF analyst James Seyffart echoed this optimism, interpreting BlackRock’s updated S-1 as a significant indicator that issuers and the SEC are actively working toward spot Ethereum ETF launches. 

This is almost certainly the engagement we were looking for on the S-1’s following the 19b-4 approvals. Issuers and SEC are working towards spot Ethereum ETF launches. https://t.co/xj3oyZvZEA

— James Seyffart (@JSeyff) May 29, 2024

SEC Approvals Fuel Ethereum ETF Launches

Last week, the SEC approved BlackRock and other industry-leading funds, including ARK Invest, VanEck, and Fidelity, as well as Grayscale for 19b-4 filings. This approval puts spot market ETH ETFs on track toward launching in the future. The SEC’s decision led to a large accumulation of Ethereum-based altcoins. One notable investor spent nearly $25 million on assets such as Lido (LDO), Uniswap (UNI), Aave (AAVE), and Ethereum Name Service (ENS).

The SEC’s approval process appears influenced by political considerations. Balchunas and others, including Ark Invest CEO Cathie Wood and Coinbase analyst David Han, have noted that the SEC’s actions are to prevent itself from being looked at as anti-crypto. Balchunas commented,

“The political goal of not appearing anti-crypto has already been achieved by simply not rejecting [the ETFs]. No real reason to rush.”

Potential Impact on Ethereum Supply

The inflows in Ethereum ETFs can have a considerable impact on the market, especially given the recent approval and launch of products linked to Ethereum. Such risks are already manifest in Bitcoin, with ETFs estimated to have directly purchased about 8.3% of all BTC tokens in circulation, centralizing the supply. 

Ethereum currently has a token supply of 120.13 million, trading at a price significantly lower than Bitcoin’s 19.7 million BTC tokens. This could increase the liquidity of shares in ETFs and, at the same time, allow issuers to acquire a larger share of Ethereum at a cheaper price. Ethereum is currently trading at $3,738.40 with a slight increase of 1%.

There has been considerable demand in institutional space for Bitcoin ETFs, which points to the probable uptake of Ethereum ETFs as well. New institutional investments could be the next major catalyst to increase demand and alter the Ethereum market structure.