Ethereum Rises 7% As $1.5T Asset Manager Files for ETF

The price of Ethereum (ETH) has risen significantly in the past 24 hours, buoyed by optimism around the possible launch of an ETH-based ETF in the United States.

The second-largest cryptocurrency by market cap is keeping up to pace with Bitcoin’s most recent rally. Ethereum surged over 8% in the past 24 hours, slightly ahead of Bitcoin’s 5% gain on the day.

While Ether’s recent surge aligns with broader positive market sentiment, the move is also attributable to growing optimism that the U.S. Securities and Exchange Commission (SEC) might eventually approve a spot-based ETF tracking the price of ETH.

The regulator has already approved the trading of Bitcoin and Ether-based futures in 2021 and, more recently, spotted Bitcoin ETF products.

As a result, market participants are growing more confident that the SEC would also greenlight a spot in ETH ETF. The optimism is further heightened by the latest application by Franklin Templeton, a popular U.S. fund manager who controls over $1.5 trillion in assets.

Franklin Templeton was among the list of firms approved by the SEC to launch a spot in the Bitcoin ETF. While the fund has not performed as well as its competitors, with just $81 million in inflows, Franklin Templeton will hope that its Ether ETF enjoys a different outcome.

Franklin Templeton Ether ETF Details

According to a February 12 filing, Franklin Templeton’s proposed Ether ETF will trade on the CBOE exchange. The fund will tap Coinbase as its custodian, while crypto-friendly bank BNY Mellon will hold cash on behalf of the funds.

Similar to the recently launched Bitcoin ETF, the proposed fund will also use only cash-creates. Therefore, the fund will at no point accept ETH deposits or pay out ETH to stakeholders.

However, it would use all received funds to acquire and hold spot ETH but sell to repay customers in cash if they seek to pull out money from the fund.

Meanwhile, Franklin Templeton is not the only fund in the running to launch a spot Ether ETF. It joins competitors Blackrock, Ark and 21Shares, VanEck, Hashdex, Grayscale, Invesco, and Galaxy, all of whom have applied for a spot in Ether ETF.

The SEC has already delayed a decision on some earlier applications. However, the regulator only has until May 23, 2024, when the regulator must decide on VanEck’s spot ETH filing.

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