Bitwise has applied to list a spot Ethereum exchange-traded fund (ETF) in the U.S., even as questions continue to swirl around when the Securities and Exchange Commission might give such investment vehicles the regulatory blessing.

Bitwise already manages the fourth largest spot Bitcoin ETF by assets under management, holding over $2 billion in BTC.

Bitwise Joins ETH ETF Bandwagon

Bitwise has taken a significant step toward introducing a spot Ethereum ETF. The company filed an S-1 registration form with the Securities and Exchange Commission on March 28, followed by a 19b-4 form barely an hour later.

If approved, the Bitwise Ethereum Trust will be listed on the New York Stock Exchange. The proposed product intends to give investors direct exposure to the industry’s largest altcoin by market cap and may stake a portion of the fund’s assets via trusted staking providers to earn more rewards.

Bitwise is one of the now-11 issuers of spot Bitcoin ETFs. The financial giant’s BITB spot ETF has collected roughly $2 billion in assets after only 2 1/2 months.

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Bitwise’s ether ETF filing sparked optimism in the crypto community about a potential spot ETH ETF approval in May. However, senior Bloomberg ETF analyst Eric Balchunas was quick to stress that the likelihood of said approval is still super low.

Balchunas noted that there are now just seven weeks before the May 23 deadline, and the SEC hasn’t gone back and forth with potential issuers over spot ETH ETFs, a contrast to the lengthy discussions that happened before BTC ETFs were greenlighted in mid-January.

SEC Uncertainty On Whether ETH Is A Security

The SEC has repeatedly shelved decisions on multiple high-profile Ethereum spot ETF applications in recent months, including those from BlackRock, Grayscale, Fidelity, Invesco, and Galaxy Digital.

Moreover, a Bitwise executive recently forecasted that spot ETH ETFs are unlikely to get the SEC’s nod this summer. “Spot Ethereum ETFs will gather more assets if they launch in December versus if they launch in May,” Bitwise’s Chief Investment Officer Matt Hougan posited. “TradFi needs more time to digest the Bitcoin ETFs.”

The Ethereum Foundation was recently embroiled in an investigation by an unknown “state authority” that was later alleged by Fortune to be an effort by the SEC as it attempts to categorize Ethereum as a security. 

Notably, the SEC has so far refused to clarify its stance on whether ether is a security or not. Now, the regulator might be forced to actually define Ethereum, which could have a huge impact on the crypto sector in the U.S.

However, BlackRock CEO Larry Fink believes that it would still be possible to launch a spot-based ETH ETF even if the Commission were to label Ethereum a security.