The Securities and Exchange Commission is preparing to rule again on another cryptocurrency ETF, as a product aimed at making ethereum more open to investors seeks formal regulatory approval.
Known as the EtherIndex Ether Trust, the fund is seeking listing on the NYSE Arca exchange, and will invite investment on the fund backed by the ethereum digital currency.
Originally floated in June of last year, the fund was cleared by NYSE in December, following an amendment to their rules that would allow this type of fund to gain listing approval.
The decision now rests with the Securities and Exchange Commission, the body responsible for regulating investments in the United States. After two earlier high-profile rulings on bitcoin ETFs, both of which declined approval, all eyes will now turn to the SEC again, as it weighs whether to permit the ethereum ETF to move forward.
According to a recent SEC notice on the proposed ruling, the SEC is now preparing to solicit input from interested persons.
"Institution of such proceedings is appropriate at this time in view of the legal and policy issues raised by the proposed rule change. Institution of proceedings does not indicate that the Commission has reached any conclusions with respect to any of the issues involved. Rather, as described below, the Commission seeks and encourages interested persons to provide comments on the proposed rule change."
The fund comes at a time when ethereum has been enjoying unprecedented growth, with the currency value recently stably rising beyond $50 for the first time.
The eventual decision will follow the recent refusal of the SEC to back two separate bitcoin ETFs, in moves which caused uncertainty among investors and sent bitcoin prices into a tailspin.
Both those previous examples required the SEC to give clearance to changes in the listing rules, which would have permitted bitcoin-based funds for the first time.
With the ethereum fund requiring similar regulatory steps to gain approval, it remains to be seen whether the SEC will approach this request with any more willingness to adapt and accept the listing.