Hashdex Pushing for a Crypto ETF: A Step Forward
Cryptocurrency ETFs have been a hot topic for years, and some have already gone public, but the question remains: Will the SEC approve Hashdex’s crypto ETF, and how will it differ from other crypto ETFs? On November 25, 2024, asset management company Hashdex took another step forward and filed a second revised S-1 filing for a cryptocurrency ETF. But will the SEC give it the green light? This is a big problem.
Are Bitcoin and Ethereum enough?
So, what does Hashdex’s proposal mean? Well, it’s all about offering investors a diversified cryptocurrency portfolio – starting with Bitcoin (BTC) and Ethereum (ETH). These two cryptocurrencies are currently the only cryptocurrencies on the Nasdaq Cryptocurrency US Index, so they will be the focus of the ETF for now. That makes sense, right? Bitcoin and Ethereum are the major players, and they have the track record to back it up. But Hashdex doesn’t stop there. They plan to expand the ETF to include more digital currencies in the future.
SEC’s slow approval process
Here’s the thing: The SEC has been very cautious about approving financial products related to cryptocurrencies. Do you still remember when Hashdex first applied for ETF? They had to revise the proposal after the SEC asked for more time to review it. This is not surprising. The SEC has historically been very, very cautious about cryptocurrencies. But the problem is, Hashdex persists and continues to tweak their filings to meet SEC standards. This back-and-forth is very typical in the crypto ETF space, but it does raise the question: How long will this take?
Cryptocurrency ETFs are gaining attention
If you’re wondering why anyone would be interested in crypto ETFs, here’s why: They’ve become incredibly popular. Just like traditional index funds (think S&P 500), crypto ETFs offer investors a way to access a broad market without having to purchase individual tokens. It’s an easy way to participate without much risk. Sygnum’s Katalin Tischhauser even noted that crypto index ETFs are particularly attractive to those who prefer traditional investment routes. Who doesn’t want a simple, diverse way to get involved in cryptocurrencies, right?
Who else is paying attention to crypto ETFs?
But the point is, Hashdex isn’t the only player in the crypto ETF game. Other firms such as Franklin Templeton and Grayscale are also developing their own cryptocurrency-focused ETFs. Franklin Templeton’s version will track the CF Institutional Digital Asset Index, similar to Hashdex’s plans for Bitcoin and Ethereum. Meanwhile, Grayscale is looking to convert its digital large-cap fund, which includes tokens like Solana (SOL) and XRP, into an ETF. With so many companies out there, it will be interesting to see who gets approved first.
What happens next?
The crypto ETF saga is not over yet, and a lot may change in the near future. A major factor? SEC leadership. Current SEC Chairman Gary Gensler will retire in January 2025, coinciding with the start of Donald Trump’s second term as president. Trump has been an outspoken supporter of cryptocurrencies, and analysts believe that with new leadership at the SEC, perceptions of crypto ETFs may shift. If the SEC relents, Hashdex’s ETF and others like it could be approved soon. It’s definitely something to see.
