21Shares files crypto index ETFs via ‘easy-to-access’ method – All you need to know

Key Takeaways

21Shares has filed for two crypto index ETFs under the faster 1940 Act route.  A market expert stated that the move would help the issuer to avoid the agency’s delay. 

21Shares has joined the crypto index ETF race, but has opted for a faster approval route, according to experts.

In a statement on the 18th of July, the firm announced that it filed for two indexes tracking the top 10 blockchains. 

One of the funds, 21Shares FTSE Crypto 10 Index ETF, will track the top 10 assets, while another will cover the top 10 programmable blockchains that focus on real-world applications beyond Bitcoin [BTC]. 

21Shares seeks faster approval

Interestingly, the index ETFs will be structured under the Investment Company Act of 1940 Act. It’s the shorter and faster approval method adopted by the REX-Osprey Solana [SOL] ETF staking filing. 

The normal Security Act of 1933 Act, which could take months before approval. However, the 1940 Act is becoming a choice for those seeking to hit the market faster. 

The rest of the potential issuers of SOL ETFs under the 1933 Act, including Grayscale, Bitwise, Canary, and 21Shares, have not been approved yet. 

On the crypto index ETF side, Grayscale Digital Large Cap Fund (GDLC) conversion was approved. But the SEC put a stay order on it until a standard structure for crypto ETF guidelines is set.

Market pundits had projected that the waiting period could extend to early fall. 

As a result, the 1940 Act route adopted by 21Shares could be to avoid this agency delay, noted Nate Geraci of ETF Store. 

“ETF issuers not waiting around for SEC to figure things out re: “crypto ETF framework”.”

Meanwhile, Federico Brokate, head of U.S. business at 21Shares, billed the products as a way to offer diversified crypto exposure amid soaring demand for such offerings. 

“Investors are increasingly looking for diversified and easy-to-access ways to participate in the long-term growth of digital assets.”

The SEC deadline for crypto index filings for Bitwise and Grayscale under the 1933 Act was this July. Only Grayscale was greenlighted, but live trading was paused while Bitwise’s status is yet to be known. 

However, Bloomberg had placed a 95% odds of approval for index products. It remains to be seen how fast the SEC will react to the latest 21Shares application. 

Source: Bloomberg