Grayscale ETH futures ETF a ‘trojan horse’ for spot Ethereum ETF: Analyst
Grayscale Investments is using its Ether futures exchange-traded fund (ETF) application as a “trojan horse” to corner the United States Securities and Exchange Commission into approving its spot Ether ETF, says Bloomberg ETF analyst James Seyffart.
Seyffart said in a Nov. 15 X (Twitter) post following the SEC delaying Grayscale’s ETH futures ETF bid that he believes if the SEC approves Grayscale’s application, then it would enable Grayscale to argue for the approval of its spot Ether ETF application.
If the SEC denies Grayscale’s bid, the asset manager could argue the SEC is treating Bitcoin and Ether futures ETFs differently by allowing one under the Securities Act of 1933 but not the other.“Watch [the SEC] try to either approve and argue why this is different from spot. Or Deny and argue why 1933 act products are meaningfully different from 1940 act products. Both are bad for SEC [in my opinion]. Genius move.”
Grayscale’s Ether futures ETF bid was submitted via a form 19b-4 — which exchanges file to inform the SEC of a security-based swap request. Seyffart said none of the 40 or so approved Ether ETF products went through the 19b-4 approval process.
Seyffart was initially unsure why Grayscale filed its Ether futures ETF via a 19b-4. He now believes Grayscale is playing “chess” with the SEC by using the Ether Futures ETF as a “trojan horse” to obtain a 19b-4 order from the regulator to corner them into a lose-lose situation.
Seyffart and Scott Johnsson, General President at Van Buren Capital General, agreed Grayscale wouldn’t launch the Ether futures ETF.
“Doubtful this product ever trades, but useful as a vessel to get spot ETH over the finish line,” Johnsson said.
Seyffart’s comments come as the SEC delayed its decision on Grayscale’s Ether futures ETF on Nov. 15 — two days earlier than its Nov. 17 deadline. Seyffart said he wasn’t surprised by the delay.
Hashdex’s application to convert its Bitcoin futures exchange-traded fund (ETF) into a spot product was also put on hold by the securities regulator on Nov. 15.
BlackRock shared a similar sentiment to Seyffart last week, arguing that the SEC doesn't have a legitimate reason to treat cryptocurrency spot and futures ETF applications differently.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
What Changed in Donald Trump’s Cryptocurrency Wallet After the Last Big Bull Rally? Here is the Latest Altcoin Portfolio
US President-elect Donald Trump has seen some changes to the assets in his wallet after the recent cryptocurrency rally.
Apple CEO Makes Bitcoin Statement! Will Apple Invest in BTC?
Apple CEO Tim Cook announced that he invested in Bitcoin.
Santiment: "As Bitcoin Falls, Investors Keep These Three Altcoins on Their Radar!"
Santiment said that Sandbox, Stellar and Ethereum are the focus of investors and are the most talked about altcoins on social media.
BREAKING: Tron Founder Justin Sun Buys $30 Million from Surprise Altcoin