In brief
- 21Shares filed with the SEC for the first SEI ETF tracking the Sei blockchain token with potential staking rewards for additional yield.
- The application joins a set of altcoin ETF filings as fund managers target smaller digital assets beyond Bitcoin and Ethereum.
- Canary Capital filed a similar SEI ETF application in May.
Asset management firm 21Shares has filed with the Securities and Exchange Commission to launch an exchange-traded fund tracking the Sei blockchain’s native token.
The proposed 21Shares SEI ETF would offer investors exposure to SEI while providing the potential for additional yield through staking rewards, according to a registration statement filed Thursday.
Following successful launches of spot Bitcoin and Ethereum ETFs in 2024, fund managers are targeting smaller digital assets, including Solana, Dogecoin, XRP, and other altcoins under a crypto-friendly Trump administration.
The Trust’s primary objective is “to seek to track the performance of SEI,” with a secondary focus on generating “rewards from staking a portion of the Trust’s SEI,” the filing reads.
It’s “highly likely that 21Shares’ SEI ETF would be accepted and would be available along with Bitcoin and Ethereum ETFs,” Krishnendu Chatterjee, CEO and co-founder of A2ZCryptoInvestment, told Decrypt.
“21Shares SEI ETF is a step towards broader application towards regulated alt investment (including staking benefits),” he added.
Still, 21Shares confirmed it has not yet concluded that staking can be offered under a public trust structure, according to the prospectus.
The Trust will use Coinbase Custody Trust Company as its primary custodian for SEI holdings, while Coinbase Inc. will serve as the prime broker for trading activities, according to the filing.
The move adds to Canary Capital’s filing of the first SEI ETF application in May, which also shares similar staking objectives.
Multiple crypto ETF applications are now in play and face SEC decision deadlines in October, with regulators extending review periods for spot XRP funds from several issuers and Solana ETF proposals, among others.
Industry experts widely expect a batch of approvals beginning in October based on established listing standards.
“Along with Digital Asset Treasury Companies, ETFs provide exposure to a new asset class for institutions, and it is not an exception but would become a new normal,” Chatterjee said, noting “XRP, Solana, and AVAX ETFs have high chances of getting approved by year’s end, even if not by October.”
SEI currently ranks as the 74th largest crypto by market capitalization at approximately $1.82 billion.
The token is trading around $0.30 following recent gains, according to CoinGecko, though it remains about 73.7% below its March 2024 all-time high of $1.14.
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