Coinbase, a top-notch cryptocurrency entity, has openly shown support for Grayscale’s proposition of transforming its Ethereum Trust into an Ether Exchange-Traded Product (ETP). This move is anticipated to make Ether more accessible and liquid for retailers and institutional investors alike.
Despite regulatory obstacles, both Coinbase and Grayscale remain hopeful about leading the creation and adoption of this cryptocurrency ETP. Their ambitious project is expected to mark a new phase of mainstream Ethereum trading and improve market stability.
Coinbase’s endorsement of Grayscale’s scheme affirms its dedication to boost the broader cryptocurrency sector, providing abundant opportunities for investors. Paul Grewal, the chief legal representative, insists on treating Ether as a commodity, which might get the nod for an Ether ETF from the U.S. Securities and Exchange Commission (SEC).
Grewal has communicated his stand in a detailed report presented to the SEC. He emphasises on the acknowledgements Ether has received from regulatory authorities, stating that they legitimize and define its place in the broader financial ecosystem.
His articulate reasoning involves numerous references to past incidents and authoritative statements. Grewal also accentuated that these recognitions fortify Ether’s position as a significant commodity.
He appreciated Ethereum’s proof-of-stake consensus methodology for its robust governance which minimizes fraud risks, further enhanced by the security protocols inherent in their blockchain.
Grayscale’s Ethereum Trust contemplates being indexed and traded as an Ethereum ETP post a rule change proposal submitted by NYSE Arca. Before finalizing such changes, SEC generally encourages public to express their views.
Although the proposal seemed promising, it has also attracted some concerns. S&P Global expressed that immediate Ethereum ETFs offering staking may bring concentration risks to the blockchain network and thereby affecting the diversity of validators in Ethereum network’s consensus method.
