The Submission of Nasdaq’s Hashdex Blended Ether ETF Application Adds to the Competition in the Cryptocurrency ETF Arena
Mitchell Nixon
Referred to as the Hashdex Nasdaq Ethereum ETF, this investment vehicle marks the initial submission for Ethereum futures and spot holdings in accordance with the ’33 Act, with oversight and supervision provided by Toroso Investments.
Nasdaq has formally submitted an application to the SEC for an Ethereum Exchange-Traded Fund (ETF) presented by Hashdex, marking a ground-breaking development in the cryptocurrency investment landscape. The Hashdex Nasdaq Ethereum ETF is poised to encompass both spot ether holdings and futures contracts in its investment portfolio.
Toroso Investments, a registered commodity pool operator with the CFTC and a member of the National Futures Association, will provide regulatory oversight for this distinctive ETF.
Amid a notable uptick in cryptocurrency ETF applications, the Hashdex fund aims to strike a balance by combining spot assets, ether futures contracts, and cash equivalents.
The Hashdex fund’s primary investment objective is to ensure that its shares closely track the daily fluctuations in the Nasdaq Ether Reference Price. To achieve this goal, the fund plans to distribute its assets across investments in ether, ether futures contracts traded on the CME, as well as cash and cash equivalents. In its 19b-4 form, Nasdaq articulated:
“Instead of holding 100% spot Ether, which could make it more susceptible to price manipulation in the spot market, the Fund will hold a mix of Spot Ether, Ether Futures Contracts, and cash,”
The Fund’s intention is to reduce its reliance on the spot market and address concerns surrounding potential manipulation in unregulated Ether spot exchanges by incorporating Ether Futures Contracts and cash in its asset holdings, it further clarified.
During the prior week, both Ark Invest and 21Shares filed requests with the SEC for a spot ether ETF, a category of ETF that VanEck is also seeking to establish. To date, the SEC has postponed its decisions on all applications it has received for spot cryptocurrency funds.
Just recently, Hashdex entered the race for a Bitcoin ETF Approval too.
Hashdex’s strategy sets it apart from recent submissions in that it will not rely on the Coinbase surveillance sharing agreement. Instead, it will procure spot Bitcoin from physical exchanges operating within the CME market.
ETF race really heating up now!