(Bloomberg) -- Crypto exchange-traded-products issuer 21Shares and Cathie Wood’s ARK Investment Management are seeking to offer the first US ETF that invests directly in Ether. 

The firms are hoping to debut the ARK 21Shares Ethereum ETF, according to a Wednesday filing with the US Securities and Exchange Commission. Their application is the first of its kind and, if offered, would mark the first US exchange-traded fund that’s physically backed by the second-largest cryptocurrency after Bitcoin. The fund would trade under the ticker ARKE. 

Wednesday’s filing comes as the race to win approval for the first US spot-Bitcoin fund intensifies. Regulators have cited concern about fraud and price manipulation while rejecting numerous applications over the past decade. But a recent court victory by Grayscale Investments against the SEC in its fight to convert its Bitcoin trust to an ETF is being seen by some analysts as eventually paving the way for a fund.  

“There’s been so much regulatory controversy about a Bitcoin spot ETF that I guess many people thought it was a step too far — but we don’t,” ARK’s Wood said. “And it’s always nice to be first.”

“There have been considerable market developments over the last couple of weeks — Grayscale winning their lawsuit being one of them, some of the statements out of the judiciary around how they’re assessing different products, as well as, quite frankly, the fundamentals in the market,” Ophelia Snyder, co-founder and president of 21Shares, said of the timing for the filing. “If you look at the state of Ethereum markets today, especially around things like the futures products, you’re starting to get to a place where those markets are much more established.”

21Shares and ARK, which have been working together since at least 2021, also have applications out for six other crypto-centric ETFs for US investors, according to the SEC website, including one that would hold Bitcoin and Ether futures, which hasn’t yet been approved by the SEC. They are seeking to offer a spot-Bitcoin ETF, having re-filed for an application for the fund in April. Other companies have also joined that race. 

21Shares is known in Europe for its suite of crypto-focused offerings. It has more than $1 billion in assets under management, according to its website.

Some crypto critics have argued that spot ETFs might not see as much demand as many analysts are predicting because investors already are able to buy Bitcoin directly from exchanges. But most consumers won’t want to set up separate brokerage accounts just to make one investment, says Snyder. It may be even more difficult for institutional investors, who need to take into account custody and tax reporting as well, among other things. 

“There is so much friction in the process that this will save people,” added Wood.

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