Grayscale, Coinbase sit down with SEC over spot Ether ETF
Grayscale and Coinbase met with the SEC on March 6 to address concerns about the conversion of Grayscale’s Ethereum Trust into a spot ETF.
Crypto firms Grayscale and Coinbase recently met with United States Securities and Exchange Commission (SEC) officials to discuss a rule change for the launch of spot Ether exchange-traded funds (ETFs).
Grayscale is seeking to convert its Ethereum Trust — which tracks the market price of Ether into an ETF, similar to the conversion of its Bitcoin Trust to an ETF in January. The meeting, held on March 6, followed the end of the commenting period for the proposal and addressed concerns about possible market manipulation should the fund be approved.
According to a presentation shared by the SEC, Coinbase argued that the same reasoning that led to the approval of Bitcoin ETFs should be applied to Ether since the token has “mechanisms that significantly limit ETH’s susceptibility to fraud and manipulation.”
Another presentation point relates to Coinbase’s surveillance-sharing agreement with the Chicago Mercantile Exchange (CME). The mechanism was implemented for Bitcoin ETFs at the request of the SEC to improve trading monitoring.
Grayscale is also proposing a second ETF for Ether futures trading. The main difference between spot and futures markets is that spot market assets are traded immediately, whereas, in the futures market, contracts are made to buy or sell assets at a future date for a specific price.