Brazil’s CVM approved the launch of Latin America’s first ETH ETF

on Jul 14, 2021
Updated: Jul 19, 2021
  • The ETF will be listed on Sao Paulo-based B3 exchange under the ticker symbol QETH11.
  • Per QR Capital, Gemini will be responsible for holding all assets under the QETH11 ETF.
  • Despite this bullish news, ETH/USD is bleeding after losing more than 3% over the past 24 hours.

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Brazil’s securities exchange commission (CVM) has approved the launch of the first-ever Ethereum (ETH/USD) exchange-traded fund (ETF) in Latin America. QR Capital, the largest crypto asset manager in Latin America, unveiled this news through a tweetstorm on July 14. Reportedly, the ETF “QETH11” will comprise 100% ETH.

Allegedly, QETH11 will leverage the same Ethereum index that the CME Group leverages. As such, the ETF will purchase physical ETH and hold it in custody to ensure transparency and security. According to the firm, QETH11 eliminates the need for registering with exchanges, creating private keys, or worrying about secure custody. This is because Gemini, which specializes in crypto custody, will be responsible for holding the invested funds in institutional-grade cold storage.

With CVM’s approval of QETH11, QR Capital is poised to expose Brazilians to the two leading cryptos by capitalization through a secure, regulated environment. Before this, CVM approved the launch of the firm’s Bitcoin (BTC/USD) ETF. The company started trading the ETF under the ticker symbol QBTC11 on June 23 on Sao Paulo-based B3 exchange.

Although the news of CVM’s approval of QR Capital’s Ethereum ETF is bullish, ETH has not reacted to this development. At the time of writing, ETH/USD is trading at $1,948.56 (£1,407.30) after plunging 3.83% over the past 24 hours.

The US SEC is yet to approve an ETF

While Brazil is making significant steps, regarding the development of its crypto ETF market, the US is yet to approve a crypto ETF. The US securities exchange commission (SEC) has received multiple crypto ETF applications over the years. While approving crypto ETFs would offer institutional investors easy access to the crypto market, the regulator has not approved any ETF application to date. Explaining its hesitance to approve crypto ETFs, the SEC cited the crypto market’s ease of manipulation and volatility.

As a result, crypto-hungry investors have decided to go with other methods that can let them participate in the rapidly-growing crypto market. For instance, institutions have been increasingly investing in the Grayscale Bitcoin Trust. Apart from Grayscale, investors have been injecting their funds into MicroStrategy, which has been doubling down on its Bitcoin business over the past few months.