The US Securities and Exchange Commission has taken a significant step by providing initial approval for Bitwise Asset Management’s exchange-traded fund (ETF) focused on Bitcoin and Ethereum . This approval, marked by the endorsement of the fund’s form 19b-4 on January 30, represents the preliminary phase required before the ETF can commence trading. However, Bitwise must still secure approval for its Form S-1 registration application for the fund to become operational.
The proposed “Bitwise Bitcoin and Ethereum ETF” aims to deliver exposure to the spot prices of Bitcoin (BTC) and Ether (ETH) within a single fund. The allocation of the fund is set at approximately 83% in Bitcoin and 17% in Ethereum , in alignment with each asset’s market capitalization. This will involve calculating the market capitalization of both cryptocurrencies by multiplying their current circulating supplies by relevant pricing benchmarks, according to the filing details.
This approval comes in the wake of the recent appointment of a crypto-friendly acting chair to lead the SEC, which may signal a more accommodating regulatory environment for cryptocurrencies. Bitwise first submitted its ETF proposal in November, just after the recent election cycle shifted political landscapes.
In terms of custodianship, Coinbase will handle the custody of the assets, while the Bank of New York Mellon will serve various roles including cash custody, administration, and transfer services. This marks the third time the SEC has approved an ETF that simultaneously tracks the spot prices of Bitcoin and Ethereum , following similar approvals for offerings from Hashdex and Franklin Templeton in December.
Moreover, Bitwise is expanding its offerings by planning to introduce ETFs for memecoins, underscoring its ambition in the evolving cryptocurrency market. As interest in crypto-based financial products grows, industry analysts suggest that issuers are exploring the SEC’s regulatory limits with innovative filings, indicating a trend towards broader acceptance of digital asset investments.
