The competition for spot Ethereum exchange-traded funds (ETFs) has intensified with Hashdex's recent filing. The Brazil-based cryptocurrency asset management platform has submitted an application for a dual ETF consisting of both Bitcoin and Ethereum. This development comes as the spot Ethereum ETF race heats up, with multiple firms vying for approval.

Hashdex's filing marks a significant shift in the cryptocurrency ETF market. Instead of pursuing individual ETFs, the company has opted for a combined Bitcoin and Ethereum ETF. If approved by the United States Securities and Exchange Commission (SEC), Hashdex will become the first provider of spot Bitcoin and Ethereum ETFs.

The Bloomberg analyst, James Seyffart, revealed that Hashdex's dual crypto ETF will be market-weighted, meaning it will be weighted based on the total market capitalization of both Ethereum and Bitcoin. The filing also disclosed that other crypto assets can be added to the dual ETF, provided they meet specific criteria.

The SEC has already approved 19b-4 forms for eight spot ETH ETFs, but S-1 registration statements are still pending approval. The regulator's chairman, Gary Gensler, has indicated that S-1 approvals are likely to come by the end of summer. Meanwhile, Seyffart has revealed that the deadline for the SEC's approval of Hashdex's combined Bitcoin and Ethereum ETF is scheduled for around the first week of March 2025.

The race for spot Ethereum ETFs has officially begun, with new filings by the Chicago Board Options Exchange. The CBOE has filed two 19b-4 applications to the SEC, requesting the listing of ARK 21Shares Ethereum ETF and VanEck Ethereum ETF investment products on its BZX Exchange. This development starts the clock for a decision by the SEC, with a final deadline estimated around May 23, 2024.

In addition to Hashdex, other firms like VanEck, ARK, and 21Shares have also filed applications for spot Ethereum ETFs. The surge in cryptocurrency ETF applications has placed significant emphasis on whether the proposed funds intend to include futures contracts or spot assets. While the SEC has granted approval for the former, the latter remains unapproved. Fund managers appear to be exploring a middle-ground option, testing their chances in this regulatory landscape.

The Hashdex Nasdaq Ethereum ETF is designed to include a combination of spot ether holdings and futures contracts in its portfolio. This pioneering approach to cryptocurrency investment within the regulatory framework aims to decrease reliance on the spot market and address concerns about potential manipulation in unregulated ether spot exchanges. The fund's primary investment goal is to mirror the daily fluctuations in the Nasdaq Ether Reference Price, allocating assets to investments in ether, ether futures contracts traded on the CME, as well as cash and cash equivalents.