Investment manager Hashdex has withdrawn its application for a spot Ether exchange-traded fund (ETF), as stated in documents filed with the United States Securities and Exchange Commission (SEC).
According to a filing from May 28, Hashdex pulled its application for the Hashdex Nasdaq Ethereum ETF, which would have required a proposed rule change. The withdrawal occurred on May 24, just one day after the SEC approved eight similar financial products.
The reasons behind Hashdex’s decision to withdraw its application are unclear, and it is unknown whether the company will resubmit the proposal. Cointelegraph reached out to Hashdex for comment but did not receive an immediate response.
A source familiar with the application informed Cointelegraph that Hashdex no longer intends to pursue a single asset Ether ETF.
On May 23, the SEC granted approval for 19b-4 filings from various companies, including VanEck, BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK 21Shares, Invesco Galaxy, and Bitwise. This paved the way for spot Ether (ETH) ETFs to be listed and traded on their respective exchanges. The launch of these funds is expected in June.
Unlike other applicants, Hashdex’s proposed ETF combined spot Ether holdings with Ether futures contracts. This approach aimed to mitigate potential manipulation. Other applicants, such as Fidelity, ARK 21Shares, and Franklin Templeton, focused on spot-based Ether ETFs and made amendments to their filings based on SEC feedback, such as removing support for ETH staking.
Additionally, Hashdex’s ETF aimed to track daily fluctuations in the Nasdaq Ether Reference Price to address concerns about market manipulation. This strategy was outlined in the company’s initial filing from September 2023.
It is worth noting that Hashdex is one of the issuers of spot Bitcoin (BTC) ETFs approved in January. The company’s Bitcoin fund used a different strategy compared to other asset managers. Instead of relying on the Coinbase surveillance sharing agreement, Hashdex sourced spot BTC from physical exchanges within the CME market.
In conclusion, the SEC’s approval of Ether ETFs faced resistance from Hashdex, who withdrew its application. The reasons for this withdrawal are unknown, and it remains to be seen if Hashdex will reconsider its proposal in the future.