Well-known investment manager VanEck revealed plans to launch an Ethereum futures exchange-traded fund (ETF). Interestingly, this development comes just hours after news broke that the U.S. Securities and Exchange Commission (SEC) was looking to quickly approve some Ethereum futures ETF applications ahead of the U.S. government shutdown.
VanEcK to launch Ethereum futures ETF on CME
According to a press release on Thursday, VanEck announced the upcoming launch of an Ethereum futures ETF called the VanEck Ethereum Strategy ETF (EFUT).
As the nature of the fund suggests, EFUT does not invest directly in Ethereum (ETH) or any other cryptocurrency; instead, it derives value by investing in Ethereum futures contracts.
To explain, a futures contract is a legally binding agreement to buy or sell a specific asset at a predetermined price on a specified future date. Therefore, futures ETFs accumulate value by tracking the performance index of these contracts.
When you’re ready, enter the ether. VanEck Ethereum Strategy ETF ($EFUT) is launching soon. Read our press release: https://t.co/4QPOVd5nB2 pic.twitter.com/vSF3HzMuvC
— VanEck (@vaneck_us) September 28, 2023
According to additional information provided by VanEck, EFUT will only invest in regulated, cash-settled ETH futures contracts listed on commodity exchanges certified by the Commodity Futures Trading Commission (CFTC).
However, EFUT will only invest in ETH futures contracts traded on the Chicago Mercantile Exchange (CME), which will also serve as the fund’s debut platform.
Upon launch, the VanEck Ethereum Strategy ETF will be managed by Greg Krenzer, a long-time employee with over 20 years of experience in asset trading and the investment firm’s current head of active trading.
It’s worth noting that EFUT does not represent VanEck’s first foray into the futures ETF market. In 2021, the investment manager launched the VanEck Bitcoin Strategy ETF (XBTF), an investment fund that provides exposure to Bitcoin futures contracts.
Analyst: Ethereum ETF progress is accelerating
As mentioned earlier, before VanEck announced the upcoming launch of the Ethereum Strategy ETF, there were reports that the SEC intended to expedite the approval of the Ethereum futures ETF application.Bloomberg analyst Eric Balchunas shared this development By post on X on September 27th.
The U.S. Securities and Exchange Commission has given asset managers seeking to offer Ethereum futures ETFs until Friday to update their filings, as the commission hopes to approve some of these funds as early as next Tuesday due to a potential government shutdown, Balchunas said, citing anonymous sources. roll out.
For context, the U.S. government could see a partial shutdown if Congress refuses to approve four spending bills currently under consideration.
Failure by the U.S. Legislature to reach a positive consensus on these bills by October 1 (12:01 a.m. ET) will have a negative impact on the financial health of various government services and other aspects in the next fiscal year.
Still, based on VanEck’s latest announcement, Balchunas’ scoop on the Ethereum ETF saga may be correct. If so, investors can expect more positive updates from other asset managers in the U.S. Ethereum Futures ETF, most notably Valkyrie Investments and Volatility Shares, both of which Bloomberg analysts believe are SEC-approved Frontrunner.
ETH trading at $1,661.4 on the hourly chart | Source: ETHUSD chart on Tradingview.com
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