Analyst: Valkyrie likely pressured not to buy more Ethereum futures

As per Eric Balchunas, a Bloomberg senior ETF analyst, Valkyrie has issued a 497, declaring that they won’t be buying any more Ethereum futures.

Balchunas speculates that the United States Securities and Exchange Commission (SEC) might have influenced their decision to halt these purchases.

The plot thickens, Valkyrie just put out 497 that they are in fact not going to buy Ether futures until they are live (prob Tue) and are going to sell the Eth futures they bought (in an effort to jump line a bit). SEC must have threatened them to cut it out. Damn. https://t.co/yDkggCw3d1 pic.twitter.com/cKaV7k7AJs

— Eric Balchunas (@EricBalchunas) September 29, 2023

According to reports on Sep. 28, the Valkyrie Bitcoin Strategy exchange-traded fund (ETF) was reported to be adding exposure to Ethereum futures contracts, becoming the first American ETF to offer holders exposure to Ethereum and Bitcoin futures in one package. 

Valkyrie was also the first company to receive approval for an Ethereum futures ETF, updating its prospectus and risk disclosures related to Ethereum.

The jockeying has begun in full as Valkyrie announcing they are buying Ether futures for $BTF today (ahead of formal name change on Tue). In related news, hearing that some issuers are ready to launch Monday morning, unclear how many yet, but at least a couple. Game on. https://t.co/I1FiVU58RZ

— Eric Balchunas (@EricBalchunas) September 28, 2023

A senior ETF analyst has reported that there is competition in this space.

However, Valkyrie announced that it would not make any more purchases until next Tuesday, instead selling the futures they bought to “jump the line a bit.”

Bloomberg Intelligence analyst James Seyffart has also provided updates on the Ethereum futures ETF. Bitwise filed for a pure Ethereum ETF under AETH with a fee of 0.85% and an expected launch date of Monday.

The SEC delayed the WisdomTreeFunds spot Bitcoin ETF ruling, leaving only VanEck and Fidelity awaiting approval.

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ProShares ETF has also announced that they will file an updated prospectus for their equal-weight Bitcoin and Ethereum ETF, set to launch next week.

Seyffart reports that the expense ratio is set for 0.95% under ticker BETE.

ProShares looks ready to rock with three Ether ETFs on Monday (all priced at 95bps).. they join Bitwise (with two ETFs at 85bps) and VanEck (with one at 66bps). So that leaves us with a total of 6 ETFs (so far) in the Monday horse race. pic.twitter.com/e3pB0cypq7

— Eric Balchunas (@EricBalchunas) September 29, 2023

Balchunas notes that six ETFs are currently competing for launch early next week.

Read more: Bitwise withdraws Bitcoin and Ethereum ETF application