Crypto asset manager 21Shares has officially filed with the U.S. Securities and Exchange Commission (SEC) to launch an exchange-traded fund (ETF) tracking the price of SEI, the native token of the Sei network. This move follows a similar filing by Canary Capital in April, intensifying the race for the first SEI-based ETF.
What is SEI and the Sei Network?
SEI is the native cryptocurrency of the Sei network, a layer-1 blockchain launched in August 2023. It is designed to provide high-performance trading infrastructure for decentralized exchanges (DEXs) and marketplaces.
The SEI token serves multiple purposes:
- Payment for gas fees
- Participation in network governance
Currently, SEI trades at $0.30, reflecting a 4.2% gain in the last 24 hours, according to CoinGecko, which ranks it 74th by market capitalization.
21Shares’ SEI ETF Proposal
The ETF will use CF Benchmarks, a crypto price index provider, to track SEI’s price using data from multiple exchanges. Coinbase Custody Trust Company is set to act as the custodian for SEI tokens.
Additionally, 21Shares is exploring the possibility of staking SEI within the ETF to generate passive income, provided it does not introduce legal, regulatory, or tax risks.
In an official statement, 21Shares called this filing a “key milestone” in their mission to broaden exchange-traded access to the Sei Network.
The Race for the First SEI ETF
Canary Capital, a U.S. digital asset investment firm, submitted a similar application in April. Their proposed ETF aims to offer investors:
- Direct exposure to staked SEI
- Passive income through staking rewards
According to Justin Barlow, Executive Director at the Sei Development Foundation, ETFs represent a gateway for broader adoption, bridging the gap between crypto and mainstream markets.
Currently, the U.S. has approved spot crypto ETFs only for Bitcoin and Ethereum. However, multiple issuers are competing for ETFs tied to other cryptocurrencies:
- VanEck, Bitwise, and Grayscale: Solana (SOL)
- Others: XRP, Cardano (ADA), and Dogecoin (DOGE)
- 21Shares itself has applied for ETFs tracking SUI, XRP, and Ondo Finance’s token
The SEC is reportedly considering a simplified approval process where, after filing Form S-1, ETFs could be automatically approved after 75 days if the SEC raises no objections.
Key Takeaways
- 21Shares and Canary Capital are competing for the first SEI ETF.
- SEI is the token of the Sei network, a blockchain focused on trading infrastructure.
- The SEC may soon introduce an automated ETF approval process, accelerating crypto ETF adoption.
With SEI’s growing popularity and multiple ETF applications pending, the launch of an SEI ETF could mark a significant milestone for institutional adoption of new blockchain projects.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.