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The Ethereum ETF is the first of its kind to be listed on a major stock exchange. It is backed by 3iQ with Gemini Custody Services managing the ETF.
The Toronto Stock Exchange (TSX) on Thursday got its first Ethereum-based ETF. The fund, which made its debut at $10.80 per share, raised $76.5 million in its IPO and holds almost 134,000 ETH. This listing is a step towards bringing digital asset trusts to a new crowd of investors and traders. Canadian digital assets manager 3iQ was given the go-ahead for the fund on 3 December. It saw a volume exceeding $310,000 on its first day, trading 345,331 shares.
The TSX debut did not go smoothly though. Traders had to wait two hours before the fund was made available for trading. This was due to a delay in closing the ETF’s IPO prospectus. Beginning its day at $10.80 per share, the fund experienced a $11.48 peak and closed at $11.02. With ETH prices being down by about 0.5% on Thursday, this represents a 2.5% gain.
The fund gives traders and investors exposure to the ETH market without necessarily buying, storing or selling ETH the digital asset.
The Ether Fund is not 3iQ’s first crypto-backed security. On 20 October, 3iQ announced the addition of the Bitcoin fund to the exchange (TSX:QBTC). In a research report by Digital Asset Research released earlier this month, 3iQ was ranked ‘the third biggest digital asset fund in the world’.
A press release made available before the opening of the Ether Fund’s trading states:
“Gaining access to digital assets […] can be daunting, costly, and inconvenient. 3iQ offers investors convenient and familiar investment products to gain exposure to digital assets.”
Other firms like Grayscale and MicroStrategy are also making it easy to invest in cryptocurrencies. New York-based Grayscale purchased an additional $58 million in ETH and $266 million of Bitcoin on Thursday. It increased its regulatory status to an SEC reporting company in mid-October and made more than $1 billion in crypto investments in the third quarter of 2020. Business intelligence and mobile software company MicroStrategy has in recent times become a leader in bitcoin investment. It recently announced its plan to invest $550 million in BTC.
With Bitcoin and Ethereum prices peaking, it’s no wonder that investment firms are taking Bitcoin mainstream. It remains to be seen if the new crop of investors will help drive crypto prices higher.