Breaking: Hashdex Nasdaq Withdraws Spot Ethereum ETF
Hashdex has officially withdrawn its proposal for a spot Ethereum ETF. The withdrawal was made only a week after the U. S. Securities and Exchange Commission (SEC) gave green light to similar proposals from eight other issuers.
Hashdex Withdraws Spot Ethereum ETF
Nasdaq filed the notice of withdrawal for the Hashdex Nasdaq Ethereum ETF on Tuesday, which signaled a shift in the company’s direction. This decision came in the wake of the SEC approving 19b-4 forms for eight Ethereum ETFs from traditional players like VanEck, Fidelity, Franklin, Grayscale, Bitwise, ARK Invest & 21Shares, Invesco & Galaxy and BlackRock’s iShares Ethereum Trust.
The approved ETFs are expected to provide the Ethereum investment with a new level of openness and turnover, which will likely have an impact on the market.
Hashdex’s initial filing with the SEC was made in September and it planned to launch a fund that will invest in Ether, Ether futures contracts on the CME, and cash equivalents. Managed by Toroso Investments, a registered commodity pool operator, the ETF aimed to offer investors a regulated pathway to gain exposure to Ethereum’s price movements.
Lawmakers’ Comments and Public Response
The proposed ETF received a number of public comments before the 19b-4 forms were approved, including comments from lawmakers. Democratic Senators expressed their concerns and requested the SEC not to approve spot Ethereum ETFs. On the other hand, Republican Representatives French Hill of Arkansas, Tom Emmer of Minnesota and Josh Gottheimer of New Jersey urged for approval in a letter.
However, while rejecting the Hashdex proposal, the SEC’s acceptance of the eight other Ethereum ETFs shows a shift in its position toward regard Ethereum as a commodity. However, their S-1 registration statements must be effective before these issuers can trade. The SEC has recently started talking with issuers concerning their S-1 forms, although the approval timeframe still needs to be determined. Some analysts have estimated that these ETFs may take several weeks to start trading.
Furthermore, former SEC Chairman Jay Clayton shed some light on the approval situation regarding Ethereum ETFs and pointed out that listing approval is only the first step. The latter is relatively more comprehensive and includes the approval of the registration statements of the funds, which contain information to be given to prospective investors.
Ethereum ETFs Market Expectations
Bloomberg analyst Eric Balchunas has suggested that the market reaction to Ethereum ETFs will not be as enthusiastic as the reaction to Bitcoin ETFs. He initially predicted that Ethereum ETFs could trade only one-tenth of the volume of Bitcoin ETFs but has since adjusted the number to one-fifth.
Balchunas stated that the initial capital required is between $1 to $2 billion in the first couple of weeks to be considered successful.
Another Bloomberg ETF analyst, James Seyffart, predicts that trading may commence as early as July or August, given the timely approval of the S-1 documents. These documents are important because they provide an initial overview of the funds’ organization and approach.
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