Updated: Jun 1, 2021
CI Global Asset Management has filed a preliminary prospectus for CI Galaxy Ethereum ETF (“ETHX”) additionally Evolve Funds Group Inc. (“Evolve”) has also filed a preliminary prospectus with the Canadian securities regulators for the Ether ETF (“ETHR”).
By Allan R. Kirby
Ethereum is a decentralized, open-source blockchain featuring smart contract functionality. Ether (ETH) is the native cryptocurrency of the platform. It is the second-largest cryptocurrency by market capitalization, after the popular Bitcoin. Ethereum is the most actively used blockchain technology Wikipedia. Additionally, Ethereum comes complete with its own programming language which runs on a blockchain, enabling developers to build and run distributed applications. Although technically speaking Ethereum's focus is blockchain technology and should not compete with Bitcoin, it has become a competitor on cryptocurrency exchanges. Interestingly many cryptocurrency tokens are also issued over the Ethereum network which is why it is considered better than Bitcoin because Ethereum's strength is its blockchain technology.
This is one key reason why people are looking to invest in Ethereum, the increasing use of blockchain technology, which has endless possibilities in finance such as facilitating online payments as well personal and corporate loans.
With demand and interest for both the blockchain technology as well as Ethereum cryptocurrency, two Canadian companies are looking to provide investors with a way to invest with the creation of ETF's that will focus on Ethereum cryptocurrency.
CI Global Asset Management ETF
CI Global Asset Management is trying to be the first ETF in the world to invest directly in Ether, the cryptocurrency built on the Ethereum blockchain. Kurt MacAlpine, Chief Executive Officer of CI Financial, the parent company of CI GAM stated:
“Cryptocurrencies are transforming the financial world, and we are excited to launch the world’s first ETF investing directly in Ether, one of the most highly valued cryptocurrencies”
CI Galaxy Ethereum ETF will trade on the TSX under the ETHX ticker and is designed to provide investors with a convenient way to gain exposure to Ether through an institutional-quality fund platform. ETHX will invest directly in Ether with its holdings priced using the Bloomberg Galaxy Ethereum Index (“ETH Index”), which is designed to measure the performance of a single Ether traded in U.S. dollars. The ETH Index is owned and administered by Bloomberg Index Services Ltd. Source
Evolve Funds Group Inc ETF
Evolve Funds Group Inc. (“Evolve”) is the second Canadian company that has filed a preliminary prospectus with the Canadian securities regulators for the Ether ETF (“ETHR”) fund. The ETHR is designed to provide investors with exposure to Ether, currently the world’s second-largest cryptocurrency by market capitalization. AS Raj Lala, President, and CEO, at Evolve states:
"As a leader in disruptive innovation, we look forward to providing Canadian investors with access to another leading cryptocurrency through an ETF structure,”
Raj Lala goes on to comment that “Cryptocurrencies are fundamentally transforming digital finance and Evolve is quickly establishing itself as a leading facilitator for investing in this space. Ether is a digital asset that is not issued by any government, bank or central organization and was intended to complement rather than compete with bitcoin.”
The Fund’s portfolio will be priced based on the ETHUSD_RR, a once-a-day benchmark index price for Ether denominated in U.S. dollars and administered by benchmark administrator, CF Benchmarks. The ETHUSD_RR is also currently the settlement index for futures contracts listed by CME Group.
Looking to invest in Cryptocurrencies? Try Grayscale Bitcoin/Ethereum Trusts (BTC, ETHE)
Keep in mind there are some risks
These are still speculative investments with high volatility, Ertherium can see considerable swings in their values. For many potential investors, this can be nerve-racking seeing how unpredictable their values can swing. However, as I had mentioned earlier the increasing use of blockchain technology, which has endless possibilities in finance as well as Etherium as a stored value still has a lot of potential. But you need to do your research if these newer ETFs, once launched, to see if they will be good investments over the longer term.
Disclosure: mysmallbank.com nor the author received any compensation from the mentioned companies. The article is our opinion only and is written to help readers learn more about the launch of the ETFs mentioned in this article. Consider this as basic information only and utilize professional services and additional sources before making an investment decision.