Update Aug. 31, 11 pm UTC. This article has been updated to include a statement from 21Shares’ head of US business.
Crypto asset manager 21Shares filed with the US Securities and Exchange Commission (SEC) to launch an exchange-traded fund tracking the price of SEI, following Canary Capital’s similar application in April.
The S-1 registration statement filed with the SEC on Thursday proposes utilizing crypto price index provider CF Benchmarks to track the price of SEI, using data from multiple crypto exchanges.
SEI is the native token of the Sei network, which was launched in August 2023. The network itself is a layer-1 blockchain that specializes in trading infrastructure for decentralized exchanges and marketplaces. Its native token can be used to pay for network gas fees and participate in governance.
In a statement to Cointelegraph, Federico Brokate, head of US Business at 21Shares, said the firm chose SEI for its ETF because it “stood out as a high-performance layer 1 designed specifically for trading applications, with growing adoption across decentralized exchanges and infrastructure.”
”We believe SEI represents an important development in the evolution of blockchain scalability and utility, and our goal is to provide investors with regulated, transparent access to this emerging asset.”
Coinbase Custody Trust Company would act as the SEI custodian, while 21Shares also floated the possibility of staking SEI to generate additional returns. However, the firm said in the filing it’s still investigating whether there would be “undue legal, regulatory or tax risk.”
Race for first SEI ETF
There are currently no approved spot crypto ETFs in the US other than Bitcoin and Ethereum, although there are several applications for ETFs targeting other cryptocurrencies.
In an X post on Thursday, 21Shares said the ETF filing was a “key milestone in our vision to expand exchange-traded access to the SEI Network.”
Brokate said the S-1 filing is the first step in a longer regulatory process, with approval depending entirely on the SEC’s review.
“Historically, these processes can take several months or more. Our focus is on ensuring that the structure is compliant and ready should approval be granted,” he said.
”It’s early days, and while there is no guarantee of approval, we believe this is a meaningful step in advancing the conversation around how investors can safely and transparently access a wider set of blockchain ecosystems.”
The token SEI currently trades for $0.30 after rising 4.2% in the last 24 hours. CoinGecko ranks SEI in 74th place in terms of market capitalization.
Another SEI ETF has already been filed
US digital asset investment firm Canary Capital also applied for an SEI ETF, in April, which would “offer institutional and retail investors direct exposure to staked SEI,” and also have “passive income via staking rewards,” according to an April 30 statement from the SEI network.
Justin Barlow, executive director at the Sei Development Foundation, said in a statement following Canary Capital’s filing that ETFs are “a gateway for broader adoption, providing a vital bridge between crypto and mainstream markets.”
A flood of other ETF applications waiting in the wings
21Shares already has ETFs on the market, including the ARK 21Shares Bitcoin ETF, which tracks the price of Bitcoin (BTC), and has applied for others to track SUI (SUI), XRP (XRP) and Ondo, the token of DeFi platform Ondo Finance.
Other ETF issuers such as VanEck, Bitwise, and Grayscale have submitted applications for Solana (SOL), while yet other issuers are pursuing products tied to XRP, Cardano (ADA) and even memecoins like Dogecoin (DOGE).
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In an effort to streamline approvals, the SEC is reportedly exploring a simplified listing structure that would automate a significant portion of the process, according to crypto journalist Eleanor Terrett.
Terrett said under the new system, issuers would submit the standard SEC form S-1 and wait for 75 days. If the SEC doesn’t post a formal objection, the ETF would be automatically approved for listing, possibly reducing the back-and-forth communication between fund managers and the regulator.
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