VanEck Discontinues Ethereum Futures ETF, EFUT, Amidst Shift to Spot ETPs

Here is the article formatted in HTML with emphasis on important points using tags and a hyperlink to a relevant article on CoinSeeks.com:

The Ethereum Futures ETF, EFUT, Discontinued by VanEck: A Significant Shift in the Cryptocurrency ETF Landscape

In a landmark moment for cryptocurrency exchange-traded funds (ETFs), VanEck has discontinued the Ethereum Futures ETF, EFUT, in favor of a spot ETC. This move marks a significant shift in the strategy of the investment giant, which has approved the creation of a spot ETF for the same product.

The Board of Directors officially approved the liquidation and dissolution of the Fund, which means EFUT shares will no longer be listed on the CBOE exchange by September 16. However, authorized participants will have until this date to place creation orders.

The decision to discontinue EFUT is multifaceted. One key reason is the low investor interest, with EFUT having primarily US-based total assets of only $21 million. In contrast, the newly approved spot ETP, ETHV, has seen a significant inflow of $63 million in net income, according to Farside Investors data. This stark difference in investor interest likely played a significant role in VanEck’s decision to pull out EFUT.

Another important reason for EFUT’s withdrawal is its poor performance, which has caused its share price to fall by 4.42% to $19.26 and its value to plummet by 36.85% over the past six months. This decline is reflected in the wider Ethereum market, where it lost 40% of its value within three months and is currently trading at $2,200.

The approval of the spot ETF, ETHV, is also a likely reason for VanEck’s decision to stop selling EFUT. Spot ETPs are considered to be more attractive to investors because they can track the price of an asset more closely than their relative value. EFUT and other ETFs typically have more intricate trading strategies and are subject to variations in roll yield or contango.

VanEck’s move to cease trading with EFUT is not just about the details of what led to its withdrawal but also points to the fact that market demand, performance, and regulatory approvals can change rapidly. It emphasizes the increasing importance of spot ETFs, which are increasingly viewed as a viable option for those interested in investing in cryptocurrency.

For more insights on the evolving cryptocurrency ETF landscape, read “Cryptocurrency ETFs: What You Need to Know” on CoinSeeks.com.

In conclusion, VanEck’s decision to discontinue EFUT is aimed at helping investors understand the market and capitalize on the potential advantages of cryptocurrencies. The investment giant’s decision is a testament to its commitment to providing investors with innovative and attractive products, as well as adapting to changing market trends. As the cryptocurrency ETF space continues to evolve, investors and market watchers will be watching closely for any developments in this space.