Bitwise, a cryptocurrency asset management firm, is considering the possibility of offering an exchange-traded product (ETP) that focuses on Ethereum’s ecosystem of layer 2 networks and applications. Matt Hougan, the firm’s chief investment officer, expressed both excitement and a hint of embarrassment that Bitwise does not currently have such a product. He believes that owning all layer 2s and applications would be a great investment. Hougan also emphasized the significance of the upcoming Dencun upgrade, which he believes the market is underestimating.
Hougan expressed concern that the market may not be ready for a spot Ethereum exchange-traded fund (ETF) by May. He hopes that the United States securities regulator will delay approval until December, as financial advisors are still focused on the recently approved spot Bitcoin ETFs. Bitwise filed the necessary forms with the SEC to list a spot Ether ETF on March 28, joining other prominent applicants like BlackRock, VanEck, and Fidelity. There is uncertainty regarding the approval of spot Ether ETFs, as some analysts believe that the SEC has been reluctant to engage with applicants.
Despite this uncertainty, Grayscale’s chief legal officer, Craig Salm, stated that the issues surrounding spot Ether ETFs have already been resolved with spot Bitcoin ETFs. These issues include creation and redemption procedures, models for cash and in-kind investments, asset protection, loss prevention, and custody. Bitwise is one of 11 issuers of spot Bitcoin ETFs and its Bitwise Bitcoin ETF (BITB) has garnered over $1.6 billion in flows.
Bitwise is considering the creation of an ETP focused on Ethereum’s layer 2 networks and applications. The firm believes that owning all layer 2s and applications would be a lucrative investment. There is uncertainty regarding the approval of a spot Ethereum ETF, with some analysts expressing doubts about the SEC’s willingness to engage with applicants. Grayscale’s chief legal officer remains optimistic, stating that the issues surrounding spot Ether ETFs have already been resolved with spot Bitcoin ETFs. Bitwise filed the necessary forms with the SEC in the hopes of listing a spot Ether ETF.
