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After much anticipation, the U.S. Securities and Exchange Commission (SEC) has given the green light for the eventual rollout of ETFs that invest in the cryptocurrency Ether.

In a filing Thursday, the agency said that after careful review, it approved applications by Nasdaq, Cboe and the New York Stock Exchange to list spot Ethereum ETFs, noting the proposals by the exchanges were found to be consistent with the Securities Exchange Act.

The decision comes just months after the regulator reluctantly approved bitcoin ETFs.

However, spot Ethereum ETFs can’t begin trading just yet. The SEC will still need to approve individual applications from asset managers for prospective funds to launch.

Crypto fanatics and asset managers vying to launch these funds, such as VanEck, applauded the development.

“We expect the improved political backdrop will lead to further victories for digital asset investors & developers, via new laws & in the courts, that draw investment to Bitcoin, Ethereum and other open-source blockchain software,” said VanEck’s head of digital assets research, Matthew Sigel, in a post on X shortly after the SEC decision.

Spot Ethereum ETFs will allow investors to gain exposure to Ether without having to directly purchase and store the digital asset themselves.

Here are some other things to know about spot Ethereum ETFs.

Why all the excitement over spot Ethereum ETFs?

Ether, which powers the Ethereum network, is the second most popular digital token after bitcoin, the original cryptocurrency. It’s also the second largest cryptocurrency by market capitalization.

While bitcoin was created as an alternative to physical currency, Ethereum is a platform that enables smart contracts and decentralized applications to be built and run on a peer-to-peer network as opposed to a single computer.

Ever since spot bitcoin ETFs got the SEC’s green light in January, crypto enthusiasts have been watching for the approval of spot Ethereum ETFs, which could send Ether’s price to a new record high. It could also pave the way for increased adoption of other cryptocurrencies.

How many spot Ethereum ETFs could there be?

The SEC said it is finishing approval of the applications for eight spot Ethereum ETFs.

Some of the firms looking to launch these investment vehicles include BlackRock Inc., Franklin Templeton, Fidelity Investments and VanEck.

When is it better to hold actual Ethereum?

An ETF will not put an actual cryptocurrency into investors’ accounts, meaning that they cannot use it.

Also, an ETF would not provide investors with the same anonymity that crypto does, which is one of the big draws for many crypto investors.

What concerns should investors have?

The biggest concern for an investor in one of these ETFs is the volatility associated with cryptocurrencies.

There are also mixed concerns regarding potential fraud and manipulation risks associated with the Ethereum network.

In its filing, the SEC noted that some commenters contended that the commission should disapprove of spot Ethereum ETFs because the nature of Ether and the Ethereum network makes them “inherently susceptible to fraud,” while other commenters argued the opposite.

What does this mean for Canada?

Canadian investors have been able to gain exposure to spot bitcoin and Ethereum ETFs within their portfolios since 2021. These ETFs include the Purpose Ether ETF (TSX: ETHH), Evolve Ether ETF (TSX: ETHR) and CI Galaxy Ethereum ETF (TSX: ETHX).