- The SEC approved Hashdex's proposal for a crypto index ETF.
- The ETF currently features Bitcoin and Ethereum, with possible additions in the future.
- The agency also approved Franklin Templeton's amendment to its Cboe BZX for a crypto index ETF.
The US Securities & Exchange Commission (SEC) approved asset managers Hashdex and Franklin Templeton's filing for a crypto index exchange-traded fund (ETF) on Thursday.
SEC gives greenlight to Hashdex Nasdaq and Franklin Templeton Cboe crypto index ETFs
The SEC has approved combined spot-based Bitcoin and Ethereum exchange-traded funds (ETFs) from asset managers Hashdex and Franklin Templeton, according to a filing on Thursday.
The approvals cover the Hashdex Nasdaq Crypto Index US ETF and the Franklin Templeton Crypto Index ETF. The agency stated that Nasdaq and Cboe BZX proposed rule changes to list and trade shares of the products.
The products will feature both Bitcoin and Ethereum with a 80/20 average weighting but will give room for future additions.
Nasdaq filed an amended proposal for a Hashdex crypto index ETF in September after its original filing in May.
On the other hand, Franklin Templeton has been pursuing this ETF since filing its initial proposal in September.
The updated filing, submitted earlier Thursday by Cboe BZX, received accelerated clearance due to its adherence to existing commodity-based trust share standards.
According to Bloomberg analyst Eric Balchunas, the products would likely go live in January.
The SEC's approval showcases the easing tension between the regulator and the crypto community ahead of Donald Trump's inauguration in January.
Additionally, the approval confirms Tuesday's speculations from Balchunas concerning a new wave of ETFs. Balchunas predicted that a combo of Bitcoin and Ethereum ETFs would happen first, followed by Litecoin (LTC) and HBAR ETFs approval.
Crypto ETF FAQs
An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.
Yes. The SEC approved in January 2024 the listing and trading of several Bitcoin spot Exchange-Traded Funds, opening the door to institutional capital and mainstream investors to trade the main crypto currency. The decision was hailed by the industry as a game changer.
The main advantage of crypto ETFs is the possibility of gaining exposure to a cryptocurrency without ownership, reducing the risk and cost of holding the asset. Other pros are a lower learning curve and higher security for investors since ETFs take charge of securing the underlying asset holdings. As for the main drawbacks, the main one is that as an investor you can’t have direct ownership of the asset, or, as they say in crypto, “not your keys, not your coins.” Other disadvantages are higher costs associated with holding crypto since ETFs charge fees for active management. Finally, even though investing in ETFs reduces the risk of holding an asset, price swings in the underlying cryptocurrency are likely to be reflected in the investment vehicle too.
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