An innovative investment instrument has always excited investors. Crypto has been generally viewed as a high-risk investment, however, products like Exchange-Traded Funds (ETFs) make the high yielding high risk asset attractive and safe.
Now, ProShares is set to introduce an ETF which will provide investors a unique way to trade Ethereum. SETH or the Proshares Short Ether Strategy ETF will start trading in November on the NYSE Arca exchange.
The ETF managers want to achieve investment yields that mirror the inverse of the daily S&P CME Ether Futures Index performance on a daily basis.
How will the ProShares Ethereum ETF work?
SETH will not get involved in directly shorting Ethereum. They want to take advantage of the volatility and the price dips in the market. The price fluctuations can be the arbitrage opportunities for the ETF to churn profits.
Ethereum’s performance hasn’t been satisfactory despite encouraging scalability upgrades to the network. The price is down more than three fold from its peak in 2021. Ethereum is currently trading at $1,556 (as of writing).
When will the ProShares ETF launch?
SETH’s registration statement will become effective by October 15. The fund is planned to launch by early November.
ProShares already has lined up three other Ethereum futures ETFs. Other companies like Bitwise and VanEck have also launched similar offerings.
The U.S. SEC took two years to give the green light for Ether futures ETFs after ProShares launched Bitcoin Strategy ETF in October 2021.
In July 2022, ProShares launched the Short Bitcoin Strategy ETF and it has accumulated over $75 million in assets. On the other hand, its Bitcoin Strategy ETF has accumulated over $850 million in assets.
BlackRock’s filing changed the game
The crypto investment landscape has witnessed significant developments in recent times. After BlackRock filed for a Bitcoin ETF, several other investment firms rallied behind it, seeking to introduce their own Bitcoin-related investment products.
Following this trend, these firms are now turning their attention to Ethereum, with a growing interest in creating Ethereum ETFs.
The cryptocurrency investment space is clearly in a state of evolution, with new opportunities emerging for investors seeking to gain exposure to digital assets. The upcoming launch of ProShares’ Proshares Short Ether Strategy ETF (SETH) is indicative of the growing interest in cryptocurrency investment products.