Crypto News- Ark Invest and 21Shares have recently made significant adjustments to their Ethereum ETF proposal, as reported on May 10th. Initially, their filing on February 7th included plans for staking, wherein 21Shares aimed to stake a portion of the fund’s assets through third-party providers. This strategy was designed for 21Shares to receive Ethereum as staking rewards, treating these earnings as income generated by the fund. However, the filing also acknowledged potential risks associated with staking, such as losses from slashing penalties and inaccessible funds during bonding and unbonding processes.
Ethereum ETF Proposal Tweaked: Ark Invest, 21Shares Remove Staking Element
In their updated filing, this section regarding staking has been removed. However, broader comments on potential losses to other validators due to staking and its impact on Ethereum’s price remain intact. Bloomberg ETF analyst Erich Balchunas suggested that this alteration might be in response to SEC feedback, although no comments have been officially made. He speculated that it could be a strategic move to streamline the application process or reduce the amount of information available for a potential rejection.
SEC Review Timeline for Spot Ethereum ETF Proposals
The SEC is anticipated to make decisions regarding several spot Ethereum ETF proposals within the next two weeks. VanEck’s application is due for review on May 23rd, followed by Ark and 21Shares on May 24th. However, it’s expected that the SEC will assess all similar applications concurrently.
Modest Approval Prospects for Spot Ethereum ETFs as Competitors Incorporate Staking
Expectations for approval are modest, with Polymarket odds indicating a mere 10% chance of spot Ethereum ETF approval by month’s end, slightly up from 7% the previous week. Other contenders, such as Franklin Templeton and Fidelity, have also included staking possibilities in their February filings, while Grayscale introduced a similar concept in a March filing.
FAQs
What changes did Ark Invest and 21Shares make to their Ethereum ETF proposal?
They removed plans for staking that were initially included in their filing on February 7th.
What was the staking strategy initially proposed by 21Shares?
21Shares intended to stake a portion of the fund’s assets through third-party providers to earn Ethereum rewards.
Why did Bloomberg ETF analyst Erich Balchunas suggest that the adjustment could be a response to potential SEC feedback?
He speculated that it might aim to streamline the application process or reduce the grounds for potential rejection.
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