The cryptocurrency asset management firm 21Shares has submitted a filing to the US Securities and Exchange Commission (SEC) to establish an exchange-traded fund that will track the value of SEI, following the application by Canary Capital in April.
The S-1 registration document submitted to the SEC on Thursday suggests partnering with crypto price index provider CF Benchmarks to monitor the price of SEI, utilizing data from various crypto exchanges.
SEI is the native token of the Sei network, which was introduced in August 2023. This network operates as a layer 1 blockchain that focuses on trading infrastructure for decentralized exchanges and marketplaces. Its native token is utilized for covering network gas fees and engaging in governance processes.
Coinbase Custody Trust Company will serve as the custodian for SEI, while 21Shares has also proposed the potential for staking SEI to achieve additional profits. Nonetheless, the firm noted in the filing that it is still examining whether there will be no “excessive legal, regulatory, or tax risks.”
Competition for the first SEI ETF
Presently, there are no sanctioned spot crypto ETFs in the US beyond Bitcoin and Ethereum, although numerous applications for ETFs aimed at other cryptocurrencies exist.
In a post on X on Thursday, 21Shares declared that the ETF filing represents a “crucial milestone in our ambition to broaden exchange-traded access to the SEI Network.”
Cointelegraph contacted 21Shares for additional insights.
Currently, SEI is priced at $0.30 after experiencing a 4.2% increase over the past 24 hours. CoinGecko positions SEI at 74th place in terms of market capitalization.
Another SEI ETF application has already been submitted
The US digital asset investment firm Canary Capital also submitted an application for an SEI ETF in April, which would “provide institutional and retail investors with direct exposure to staked SEI,” and further yield “passive income through staking rewards,” as per an April 30 announcement from the SEI network.
Justin Barlow, executive director at the Sei Development Foundation, remarked in a statement following Canary Capital’s application that ETFs serve as “a gateway for broader acceptance, providing a crucial link between cryptocurrency and traditional markets.”
A surge of other ETF applications awaiting approval
21Shares currently has ETFs available, including the ARK 21Shares Bitcoin ETF, which tracks Bitcoin (BTC), and has submitted applications for additional funds to follow SUI (SUI), XRP (XRP), and Ondo, the token linked to DeFi platform Ondo Finance.
Other ETF issuers such as VanEck, Bitwise, and Grayscale have filed applications for Solana (SOL), with additional entities seeking products associated with XRP, Cardano (ADA), and even memecoins like Dogecoin (DOGE).
Related: Crypto ETPs experience $1.4B losses amid recent Bitcoin, Ether sell-offs
To facilitate the approval process, the SEC is reportedly considering a simplified listing framework that would automate a considerable portion of the approval procedure, according to crypto journalist Eleanor Terrett.
Terrett mentioned that under this updated system, issuers would file the standard SEC form S-1 and wait 75 days. If there are no formal objections from the SEC, the ETF will be automatically approved for listing, potentially decreasing the communications between fund managers and the regulator.
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