Bitwise Withdraws Application: A Setback for Ethereum ETFs?

• Asset manager Bitwise pulls back its application for a combined Bitcoin and Ethereum futures ETF.
• Bloomberg Analyst, James Seyffart, reveals potential reasons behind this move on his X platform.
• Despite the withdrawal, several Ethereum futures ETFs are still anticipated to launch in October.

Bitwise’s surprising withdrawal decision fuels speculations on the future of Ethereum ETFs. What does this mean for the crypto industry?

Inside Bitwise’s Unexpected Decision

In a rather unexpected turn of events, Bitwise, the renowned asset manager, decided to retract its application aimed at transforming its present Bitwise Bitcoin Strategy Optimum Roll ETF to incorporate both Bitcoin and Ethereum futures contracts. This step has led many to speculate the reasoning behind such a move, especially with the forthcoming launch of Ethereum futures ETFs scheduled for October.

The Speculations and Clarifications

James Seyffart, a prominent Bloomberg Analyst, highlighted this development on his X platform, pointing out Bitwise’s choice to stick solely to its Bitcoin exposure. While the crypto community is rife with questions, Seyffart sheds some light on possible motives. He believes the decision might stem from Bitwise not seeing a clear advantage in a dual BTC and ETH ETF, more so when their Ethereum futures ETF was set to debut shortly after their initial one. Seyffart also points towards potential preferences of the firm’s Optimum Roll ETF investors, who might favor exclusive Bitcoin exposure over a combined Bitcoin and Ethereum approach. It’s also crucial to note that this isn’t Bitwise’s first such move. Earlier, the asset manager had retracted its application for the Bitwise Bitcoin and Ether Market Cap Weight Strategy ETF, filed with the SEC in early August.

The Road Ahead for Bitwise and Ethereum Futures ETF

Despite these recent actions, Bitwise hasn’t completely shelved its plans for the Ethereum futures ETF. The firm continues to hold its Bitwise Ethereum Strategy ETF application with the SEC, which is focused on investments in Ethereum futures contracts. Seyffart remains optimistic, suggesting there’s more to Bitwise’s actions than meets the eye, possibly being a product-based decision. He emphasizes that a real cause for concern would be if Valkyrie, similar to Bitwise in its ETF aspirations, retracts its application. However, barring any interventions by the SEC, several asset managers, including Volatility Shares, VanEck, ProShares, Roundhill, and even Bitwise, are all set to unveil their Ethereum futures ETFs next month.

Anticipated Launch Dates

With the race to the Ethereum ETF market heating up, Volatility Shares seems poised to take the lead, planning its launch for October 12. Other contenders are expected to follow suit, introducing their versions shortly after. This fierce competition underscores the growing interest and optimism surrounding Ethereum futures contracts and their potential market impact.

Conclusion

While Bitwise’s withdrawal might seem perplexing to some, it’s clear that the broader landscape of Ethereum futures ETFs remains unaffected, with numerous players gearing up for their respective launches. Such developments, oscillating between unexpected decisions and heightened anticipations, only further accentuate the dynamic and ever-evolving nature of the crypto industry.