US SEC Approves Two Spot Ethereum ETFs for Trading, Major Altseason Loading

After months of delay, the United States Securities and Exchange Commission (SEC) unanimously approved the proposed rule change to list and trade shares of the Grayscale Ethereum Mini Trust and ProShares Ethereum ETF. According to the SEC’s filing dated July 17, the US SEC gave the green light to the two spot Ether ETF issuers to list and trade on the NYSE Arca Inc.

However, the agency clarified that the approval is subject to final notice and comment of the S-1 filings.

Spot Ethereum ETFs Sponsor Fee Wars

According to Bloomberg’s ETFs researcher James Seyffart, there is a high likelihood of the dozen spot Ether ETF issuers beginning to trade next week. The Grayscale Ethereum Mini Trust (ETH) will have a starting sponsor fee of 0.12 percent and a post-waiver fee of about 0.25 percent.

On the other hand, the Grayscale Ethereum Trust (ETHE) will continue to operate at a fee of 2.50 percent. As a result, Seyffart highlighted that the ETHE, with total assets under management of about $9.98 billion, will bleed in a similar fashion as the GBTC. Notably, 10 percent of the ETHE will be spun off and deposited into ETH to kick-start its operation.

“Grayscale is excited to share that the SEC has approved Grayscale Ethereum Mini Trust’s Form 19b-4. The Grayscale team continues to engage constructively with SEC staff as we seek full regulatory approval for US spot Ethereum ETPs,” a Grayscale spokesperson noted.

Meanwhile, the majority of the spot Ether ETF issuers have a zero starting fee and a post-waiver sponsor fee of between 0.19 percent and 0.25 percent. The ProShares Ethereum ETF has not yet issued details of its sponsor fee as of this report.

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Okay everyone. Here are the details for the #Ethereum ETFs that we expect to launch next week. We are only missing details for Proshares's ETF. 7 of the 10 funds have fee waivers. pic.twitter.com/5v3QnHOeub

— James Seyffart (@JSeyff) July 17, 2024

Impact on Crypto Market

The expected listing and trading of spot Ether ETFs in the United States next week will have a profound impact on the entire crypto industry. Already, Grayscale announced the launch of its latest crypto investment product dubbed Grayscale Decentralized AI Fund.

Notably, the Grayscale Decentralized AI Fund will invest in TAO, NEAR, RNDR, FIL, and LPT.

With billions of dollars expected to flow into the Ethereum industry in the subsequent months, the highly anticipated altseason could materialize at any time. Moreover, the application of other spot crypto ETFs, led by Solana (SOL), is expected to take place in the coming quarters.

The on-chain data shows non-zero Bitcoin addresses have declined by more than 600k in the past month, a sign of heightened crypto cash rotation to the altcoins. From a technical standpoint, Bitcoin dominance has already signaled an inevitable macro reversal backed by a weekly bearish divergence on the Relative Strength Index (RSI).

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