Bitwise Asset Management has officially filed with the U.S. Securities and Exchange Commission (SEC) for the approval of an Ethereum-based Exchange Traded Fund (ETF), aiming to offer investors regulated access to Ethereum without the need for direct ownership of the cryptocurrency. This move by Bitwise is part of a broader attempt among major financial entities to introduce Ether-based ETFs, despite the SEC's historically cautious stance towards such investment products.
The heart of Bitwise's ETF application is a comprehensive correlation analysis, tailored to mimic the SEC's methodology previously applied to Bitcoin (BTC). This analysis compares the market dynamics of Ethereum with those of Ethereum futures on the CME across various intervals - hourly, five-minute, and one-minute. The findings demonstrate minimal deviation in correlation values, indicating a strong alignment between spot and futures markets.
On X, Bitwise announced that this discovery is crucial as it addresses potential regulatory concerns regarding market manipulation and the integrity of pricing mechanisms in the Ethereum market. The results of the study could play a pivotal role in the SEC's evaluation process, providing empirical evidence that the Ether market behaves in accordance with regulated financial markets. "We believe the results show a [strong] correlation between the spot Ethereum market and the CME Ethereum futures market, to a degree significantly similar to the SEC's analysis in the Bitcoin ETF approval order," Bitwise stated on Thursday. "This analysis is included in the new Rule 19b-4 filing submitted today by NYSE Arca, requesting approval for the listing of Bitwise's spot-based Ethereum ETF."
As the SEC reviews this application, the outcome could set a precedent for the future of other crypto assets, beyond Bitcoin, seeking to trade in a similar manner.
