Volatility Shares, a financial firm specializing in exchange-traded fund (ETF) products, has announced the cancellation of its plans to launch an Ether (ETH) futures ETF on October 2nd. The company cited changes in the market as the reason for the decision. Justin Young, the co-founder and president of Volatility Shares, confirmed the cancellation in an email with Cointelegraph, stating that they did not see the opportunity to launch at this time.
However, when asked about the possibility of launching an ETH futures ETF in the future, Young responded positively, saying that plans are still to be determined. This indicates that Volatility Shares is not completely abandoning the idea and may consider launching the ETF at a later date when the market conditions are more favorable.
Ether futures ETFs are financial products that track the prices of ETH futures contracts. These contracts allow investors to trade the asset at a specific time and price in the future without actually holding the cryptocurrency. The ETFs provide a way for investors to be involved in ETH trading without the need for direct ownership.
Volatility Shares was previously positioned to be the first firm to offer an ETH futures ETF. The United States Securities and Exchange Commission (SEC) was expected to approve the first such product on October 12th. However, concerns over a possible U.S. government shutdown on October 1st reportedly prompted the SEC to accelerate the timeline for approval. This move may have influenced Volatility Shares’ decision to cancel the launch of their ETH futures ETF.
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Despite Volatility Shares canceling its plans, several other firms have already started trading ETH futures ETFs. Companies like Valkyrie, VanEck, ProShares, and Bitwise have launched their own ETH futures ETFs and are actively trading them. However, the trading volume for these ETFs has been relatively low compared to other newly launched ETFs, with a total trading volume of under $2 million as of October 2nd.
The recent possibility of a U.S. government shutdown raised concerns about the potential impact on the cryptocurrency market. If a shutdown occurred, bills related to digital assets could be halted, and financial regulators like the SEC and the Commodity Futures Trading Commission could function with limited staff. However, the U.S. government managed to avoid a shutdown by passing a stopgap measure to fund services until November 17th. This provided some relief to the cryptocurrency industry and allowed it to continue operating without disruption.
In conclusion, Volatility Shares has canceled its plans to launch an ETH futures ETF due to changes in the market. While the company has not completely ruled out launching the product in the future, there is currently no set timeline for when that may happen. Other firms have already launched their own ETH futures ETFs, but the trading volume for these products has been relatively low. The recent possibility of a U.S. government shutdown raised concerns, but the passage of a stopgap funding measure alleviated those concerns and ensured the uninterrupted operation of the cryptocurrency market.
