The crypto industry is constantly changing and as time goesby, more and more projects pop up online. One of the recent headlines that hasbeen causing waves among cryptocurrency enthusiasts is the Ether-based futuresETF, which might soon debut in the USA.
We at Voltcoins are excited to share with you the new waysto buy Ethereum online. We provide a licensed and transparent way to purchasepopular cryptocurrencies using a simple user interface, so naturally every newproject that can help take this industry forward is something we wish toinvestigate and inform our clients about.
Explaining futures and ETFs
A futures contract is like making a promise to buy or sellsomething in the future at a set price. Imagine you agree with a friend to sellthem a toy next month for $10, no matter what the toy's price is. That'ssimilar to a futures contract.
It's used in finance for things like crops, stocks, bonds,indices and even cryptocurrencies. It helps people plan and protect againstprice changes, but it also involves risks if the prices don't go as expected.
An exchange-traded fund (ETF) based on Ethereum futures is atype of financial product that combines two concepts: Ethereum and futurescontracts. Ethereum is a digital currency like Bitcoin, which you can buy onour platform. Futures contracts are agreements to buy or sell something at aset price in the future. In this case, the ETF basically raises money frominvestors to buy futures contracts tied to the price of Ethereum.
This allows you to indirectly hold Ethereum without actuallyowning it. The ETF's value moves along with the price of the Ethereum futuresit holds. It offers an easy way for people to buy Ethereum online and takeadvantage of potential price changes without directly dealing with thecryptocurrency.
An Ether-based ETF in the USA
Major news outlets are reporting that an ETF based onEthereum futures contract might soon be available in the United States. Severalcompanies in the space have already applied for an official license to providesuch a product and it looks like at least one could debut as early as Octoberon the Chicago Mercantile Exchange.
On top of being a new reliable way to buy Ethereum online,it also ensures transparency and protection for customer funds. Since the Securitiesand Exchange Commission (SEC) has already approved Ether futures in general,experts believe that there shouldn’t be any bureaucratic roadblocks to an ETFbased on the same product.
More ways to buy Ethereum online
We at Voltcoins offer a licensed way to buy Ethereum online,and we are certain that an ETF based on this cryptocurrency can provide moreoptionality for the sector.
Ethereum is the second-largest cryptocurrency in the worldby market capitalization and it benefits from elevated interest from bothprivate and institutional buyers. This futures-based ETF can bring moreattention to it in general, alongside new opportunities.
However, you should be aware that at the time of writing,the SEC has not yet provided a green light on such products - and that there isno certainty that it will, despite the optimistic projections. We at Voltcoinswill keep you posted on our blog, and we encourage our clients to read itperiodically to stay up to date.