Key takeaways:
- The US SEC has received a filing from asset management company Bitwise listing and trading shares of a spot Ethereum ETF.
- The Bitwise team has released a groundbreaking analysis that explores Ethereum correlations, painstakingly emulating the exacting process that the SEC used to assess Bitcoin.
The US Securities and Exchange Commission (SEC) has received a filing from asset management company Bitwise listing and trading shares of a spot Ethereum Exchange Traded Fund (ETF).
Bitwise submitted a Form S-1 registration statement for shares of its Ethereum ETF to the SEC on March 28. The filing was made in the midst of rumors that the SEC intended to classify Ether as a security under its regulatory authority, raising concerns about the listing of spot ETFs in the future.
Bitwise plans to issue shares of the ETH investment vehicle on NYSE Arca, according to a 19b-4 modification filing that was submitted to the SEC. The asset manager was one of the first to receive the SEC’s permission in January for the listing and trading of shares of its spot Bitcoin ETF.
The Bitwise team has released a groundbreaking analysis that explores Ethereum (ETH) correlations, painstakingly emulating the exacting process that the SEC used to assess Bitcoin.
The analysis’s findings are quite positive, showing remarkably tight correlation values throughout a range of time periods.
Notably, variances in correlation values are negligible during the whole sample time under examination, with variances of only 0.2% for hourly correlation, 5% for five-minute correlation, and 8% for one-minute correlation.
Bitwise’s analysis closely followed a number of crucial guidelines to ensure methodological consistency with the SEC’s evaluation framework for Bitcoin.
The sample period is roughly 2.5 years. The analysis is conducted at hourly, five-minute, and one-minute intraday correlation intervals. The same markets (Coinbase/Kraken compared against CME) are examined. The same correlation statistic (Pearson correlation over log returns) is used. Finally, a three-month rolling window is applied for thorough min/max analysis.
This innovative study not only clarifies the correlation dynamics of Ethereum but also establishes a standard for methodological integrity in cryptocurrency studies. Bitwise further stated:
“We believe the results show strong correlation between the ETH spot market and CME ETH futures market, at a level substantially similar to the findings of the SEC’s analysis in the spot bitcoin ETF approval order.”
VanEck’s investment vehicle will be the first to be approved or denied in the upcoming round of spot ETH ETF applications by the SEC, with the final deadline being May 23. While a number of experts appeared to be bullish about approval in 2023, others have stated that the commission may still reject applications in 2024.
Spot Ethereum ETF applications are pending approval or rejection from a number of firms, including Hashdex, ARK 21Shares, and Fidelity. In October 2023, the SEC started to approve investment vehicles linked to Ether futures.
