The Canadian regulator, the Ontario Securities Commission, has approved three Ethereum ETFs (Exchange Traded Funds). CI Global Asset Management company Purpose Investments Inc. and Evolve Fund Group Inc. have both received approval to launch three separate Ether ETFs.
The Ether ETFs would be available on the Toronto Stock Exchange (TSX) to give investors exposure to the second largest cryptocurrency by market capitalization, Ether.
Evolve and Purpose have already traded Bitcoin ETFs on the Toronto Stock Exchange (TSX).
CI Global Asset Management is partnering with Galaxy Digital Holdings Ltd to launch the CI Galaxy Ethereum ETF on the Toronto Stock Exchange on April 20, subject to TSX approval. Steve Kurz, Partner and Head of Asset Management at Galaxy Digital, said: “We are very excited to expand our advisory relationship with CI. The CI Galaxy Ethereum ETF offers investors a simplified way to benefit from the explosion of decentralized applications based on Ethereum. “
Likewise, Evolve Fund Group Inc. plans to begin trading its Ether EFT (ETHR) on April 20 on the Toronto Stock Exchange. Raj Lala, CEO and President of Evolve stated: “We are very pleased to have launched one of the world’s first Bitcoin ETFs and are now planning to launch the world’s first Ether ETF. Similar to Bitcoin, investors can now trade Ether as easily as buying shares through their bank or broker . ETHR will offer daily liquidity, transparency and security through a regulated ETF structure. “
Purpose Ether ETF is designed to enable investors to gain exposure to Ether by investing directly in physically settled Ether. The Purpose Ether ETF is to offer three classes of shares: US Dollar Shares (ETHH.U), Non Currency Hedged Canadian Dollar Shares (ETHH.B) and Currency Hedged Canadian Dollar Shares (ETHH).
EFTs are investment vehicles that investors can use to buy stocks that represent a specific asset – in this case, ethers. Investors can trade it continuously throughout the day without worrying about whether they own the asset themselves or own cryptocurrency like storage.
In other words, Ether ETFs would allow investors to buy into the ETF without going through the complicated process of trading Ether themselves. Furthermore, since the owners of the ETFs would not invest directly in ether, they would not have to worry about the complex storage and security procedures that crypto investors need.
Bitcoin ETF problem in the US
While neighboring US regulators have not yet approved Bitcoin ETFs, Canada appears to be progressive towards regulated cryptocurrency instruments. In early February, Canada approved its first Bitcoin ETF, which has seen huge investor demand. Canadian regulators recently approved two Bitcoin ETFs that allow investors to take short positions in the cryptocurrency.
A Bitcoin ETF in the US is still a long way from approval. There is currently a long list of prominent companies (such as NYDIG Asset Management, Valkyrie Digital Assets, Galaxy Digital, SkyBridge Capital, VanEck, Cboe, WisdomTree, and Fidelity Investments) filing with the SEC for approval of the Bitcoin ETF. However, the US Securities and Exchange Commission has repeatedly denied applications for companies intending to launch Bitcoin ETFs.
The SEC claims that Bitcoin is traded on unregulated exchanges, making it vulnerable to tampering and fraud. However, there is still hope that new SEC chief Gary Gensler could change the regulator’s attitude towards the novel investment product.
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