In a significant development, Cathie Wood’s Ark Investment Management has decided to withdraw from the effort to launch a spot ether exchange-traded fund (ETF). This move has resulted in Ark’s name being removed from the application initially filed with 21Shares.
Despite Ark’s withdrawal, 21Shares remains committed to the initiative. The company has submitted an updated application for its Ethereum spot ETF, rebranding it from the Ark 21Shares Ethereum ETF to the 21Shares Core Ethereum ETF. Importantly, the amended Form S-1 indicates that there will be no changes to the fund’s fees.
A representative from Ark Invest explained that while the firm acknowledges Ethereum’s potential and long-term value, they have decided to reassess their investment strategy, leading to the decision not to proceed with an Ether ETF. However, this decision does not impact the ongoing collaboration between Ark Invest and 21Shares on other projects, such as the ARK 21Shares Bitcoin ETF, which was launched in January.
Earlier this year, Ark and 21Shares collaborated to launch one of 11 spot-Bitcoin ETFs in the U.S. The $3.2 billion ARK 21Shares Bitcoin ETF (ARKB) now ranks fourth in assets within its category, trailing behind BlackRock Inc.’s $19 billion iShares Bitcoin Trust (IBIT), which leads in terms of assets and inflows.
Under the partnership, 21Shares sponsored the ETF, with Delaware Trust Company acting as the trustee. Coinbase Custody Trust Company securely holds the underlying Ether assets, while ARK Investment Management was responsible for marketing the shares to investors as a sub-adviser.
The recent approval by the U.S. Securities and Exchange Commission (SEC) of 19b-4 forms for eight Ethereum ETFs marks another milestone. However, issuers still need their S-1 statements to become effective before these ETFs can commence trading.
“We are enthusiastic about the SEC’s recent 19b-4 approval and are committed to increasing access to crypto as an asset class for U.S. investors,” 21Shares stated, reaffirming their dedication to expanding crypto investment opportunities.
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