Grayscale Investments has taken a significant step forward in its pursuit of launching a spot Ethereum fund by filing an amended registration statement with the U.S. Securities and Exchange Commission (SEC). This move follows closely on the heels of BlackRock's filing of its own amended S-1 statement and comes in the wake of the SEC's recent approval of 19b-4 forms for eight Ethereum exchange-traded funds.

In its updated filing, Grayscale provided additional details regarding the treatment of ether and the quantity of ether held by the proposed fund. Notably, the filing specifies the amount of ether required to create baskets of shares, offering investors insights into the fund's underlying asset holdings. According to the filing, as of May 28, 2024, approximately 0.94552590 ether would be needed to create a basket of 100 shares, while creating a basket of 10,000 shares would require around 94.552590 ether.

The submission of amended registration statements by Grayscale is part of a broader trend, with more issuers expected to follow suit as the SEC deadline for draft submissions approaches. However, the effective trading of these ETFs hinges on the approval and implementation of these registration statements by the SEC.

Grayscale's Ethereum trust, launched in March 2019, is currently the largest ETH investment vehicle globally. Holding approximately 2.5% of the total ether in circulation as of March 31, the trust's conversion to a spot ether ETF underscores Grayscale's commitment to providing investors with diversified exposure to digital assets.

Amidst the recent developments surrounding spot Ethereum ETFs, questions have arisen regarding the regulatory classification of ether. While some, including Coinbase's Chief Legal Officer Paul Grewal, argue that ether is no longer a security, Grayscale's filing acknowledges the lack of official pronouncements or guidance from regulatory agencies. However, by approving exchange rule filings for trusts holding ether as commodity-based exchange-traded products, the SEC has implicitly recognized ether as a commodity.

As Grayscale continues to navigate the regulatory landscape, its latest filing represents a significant stride towards the establishment of a spot Ethereum fund, signaling broader adoption and recognition of digital assets within traditional financial markets.