SEC Approves First Step for Bitcoin and Ethereum Combined ETF

The U.S. Securities and Exchange Commission (SEC) has given initial approval for a new exchange-traded fund (ETF) proposed by Bitwise Asset Management. The fund would provide investors with exposure to both Bitcoin and Ethereum, the two largest cryptocurrencies. This approval marks an important development for those looking to diversify their investments in the digital currency market.

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How the Fund Will Work

The Bitwise Bitcoin and Ethereum ETF is designed to track both Bitcoin and Ethereum, offering a balanced investment approach. The fund would allocate assets based on the market capitalization of each cryptocurrency, allowing investors to benefit from the performance of both digital assets in a single investment. This is different from existing ETFs, which generally focus on just one of the cryptocurrencies.

Next Steps in the Approval Process

Although the SEC has approved the Form 19b-4 filing, a critical component in the approval process, the ETF still needs approval for its S-1 registration before it can be officially launched. Both of these steps are necessary for the ETF to begin trading on the market.

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Bitwise submitted its proposal for this combined Bitcoin and Ethereum ETF in November 2023, following the U.S. presidential election, which brought in a crypto-friendly administration. This shift has helped drive interest in new regulatory frameworks that could support the growth of the digital-asset industry.

Interest in Crypto ETFs Continues to Grow

The launch of Bitcoin spot ETFs in early 2024 has been a major success, with these products quickly amassing more than $121 billion in assets. The success of these Bitcoin funds, along with Ethereum-focused ETFs attracting over $11 billion, has further demonstrated the growing interest from investors in digital currency markets.

As more investment firms propose new crypto-based funds, including those tracking tokens like Dogecoin and Solana, the SEC is becoming increasingly involved in reviewing the regulatory landscape for these products. This reflects a broader trend of increasing interest in crypto investments, as traditional finance continues to embrace the digital asset space.

With the SEC moving forward with Bitwise’s proposal, the approval of a combined Bitcoin and Ethereum ETF could mark a new chapter in the evolving relationship between cryptocurrencies and traditional financial markets.

Also Read: Bitcoin Drops Below $100,000 as Chinese AI Model Triggers Market Selloff