Bloomberg ETF analyst Erich Balchunas speculates that the update might be a response to possible SEC feedback. Staking intentions have been eliminated from ARK Invest and 21Shares’ revised proposal for an exchange-traded fund that would hold spot ether. The provision indicating that 21Shares will stake a portion of the fund’s assets through third-party providers was eliminated from the amended file, which was turned in on Friday, May 10.
In the past, it stated that “Sponsor may, through one or more trusted Staking Providers, stake a portion of the Trust’s assets from time to time.” The companies filed a document on February 7th, in which they stated that 21Shares planned to qualify the revenues as income and that they expected to receive ETH as payment for staking.
The most recent filing, however, does away with the pertinent part while leaving intact more general remarks about losses resulting from reduced fines, monies that are momentarily unavailable during bonding and unbonding, and possible effects on Ether prices. Although there have been no official remarks, Bloomberg ETF analyst Eric Balchunas believes that the upgrade could be an attempt to improve the application in response to possible input from the United States Securities and Exchange Commission (SEC).
Balchunas, on the other hand, speculates that the modification might be a desperate attempt or a calculated move to reduce the amount of data the SEC has to work with when making a decision about a possible rejection.
ARK Invest and 21Shares filed a request for a spot Ether ETF in September 2023. If authorised, the fund will trade on the Cboe BZX Exchange and seeks to offer direct exposure to ether. The CME CF Ether-Dollar Reference Rate – New York Variant will be used by the exchange. ARK Investment Management acts as a sub-adviser, promoting the shares, while 21Shares is the sponsor, Delaware Trust Company is the trustee, and Coinbase Custody Trust Company will handle the underlying Ether assets.
The SEC has been putting off making spo decisions. The regulator postponed deciding on the Invesco Galaxy spot Ethereum ETF proposal as well as the deadlines for the submissions from Grayscale, BlackRock, VanEck, and Franklin Templeton.
VanEck’s spot Ethereum application must be decided by the regulator by May 23. Ark and 21Shares’ application must be decided on May 24. In January, the U.S. exchanges were permitted by the SEC to list and trade spot Bitcoin ETFs.
Though Bloomberg ETF analyst Eric Balchunas reduced his estimate of the likelihood of a spot Ethereum ETF certification by late May from roughly 70% to 25%, there has been less excitement in recent months over the approvals of Ethereum ETFs.