Cathie Wood's ARK Invest, known for its bullish stance on disruptive innovation, has surprisingly hit the brakes on its Ethereum ETF ambitions. This move comes amidst a flurry of activity in the crypto ETF space, with the SEC's recent approval of spot Bitcoin ETFs sparking a race for Ether.

ARK Shifts Gears, Leaving 21Shares to Steer Solo

A recent filing with the SEC revealed that ARK Invest has pulled out of its partnership with 21Shares for a proposed Ethereum ETF. This unexpected turn of events led to a name change for the fund, transforming it from the "ARK 21Shares Ethereum ETF" to the more generic "21Shares Core Ethereum ETF."

Bitcoin Still Shines for ARK

Despite the Ethereum ETF retreat, ARK remains firmly committed to its Bitcoin play. Their $3.2 billion ARK 21Shares Bitcoin ETF (ARKB) continues to be a powerhouse, holding the fourth spot among all Bitcoin ETFs.

The SEC Opens the Door, But the Path Isn't Clear

The SEC's green light for spot Bitcoin ETFs initially fueled excitement for a similar outcome with Ether. However, issuers like 21Shares still face the hurdle of getting their S-1 filings approved before trading can commence.

21Shares Remains Undeterred

Unfazed by ARK's departure, 21Shares maintains its enthusiasm for bringing crypto exposure to US investors. They remain committed to their existing Bitcoin ETF partnership with ARK and their suite of futures products.

Franklin Templeton Joins the Fray

Franklin Templeton is among several other issuers looking to capitalize on the potential of Ether ETFs. Their revised S-1 filing details a proposed fund with a competitive fee of 0.19%, waived for the first six months on a portion of the ETF's assets.

Bitcoin Feels the Outflow Chill

Interestingly, Wood's Bitcoin ETF faced its largest single-day outflow since launch recently, with nearly $100 million exiting the fund. This highlights the ongoing volatility within the crypto market.

Political Winds May Have Pushed the Bitcoin Approval

ETF analyst James Seyffart suggests that political considerations, rather than purely financial ones, may have influenced the SEC's decision on spot Bitcoin ETFs. He believes the Biden administration's actions and the crypto community's response played a role in the outcome.

Beyond the Big Two: Who's Next?

Crypto investor Brian Kelly raises the question of who might follow Bitcoin and Ethereum in the ETF race. While obtaining approval for other cryptocurrencies like Solana seems unlikely without substantial regulatory changes, Kelly suggests it could be a potential contender.

The Crypto ETF Landscape: A Work in Progress

With ARK Invest stepping out of the Ethereum ETF race, the landscape becomes more intriguing. The SEC's approval process remains a hurdle, and further regulatory developments will determine the future of ETFs for other cryptocurrencies.