21Shares Joins the Race to Launch a Spot Dogecoin (DOGE) ETF

Zurich-based asset manager 21Shares has filed an S-1 with the SEC for a spot exchange-traded fund (ETF) that would track the price of Dogecoin (CRYPTO: DOGE).

What Happened: The spot ETF will reflect the performance of Dogecoin, according to the filing.

21Shares describes the crypto ETF as a “passive investment vehicle.” The asset manager will not use leverage, derivatives, or other investment techniques to generate returns for investors. Instead, the ETF will hold actual Dogecoin, which will be valued based on the Mid-Point Price Index.

Coinbase Custody Trust Company will provide custody services for Dogecoin, while 21Shares will act as the sponsor of the ETF.

The filing did not disclose what exchange 21Shares spot Dogecoin ETF will be listed and traded on. If the asset manager decides where shares of the ETF will trade, the exchange will submit a 19b-4 filing with the SEC. This would make 21Shares' application for a Dogecoin ETF official, potentially tying the SEC to an approval timeline.

The ticker, trustee, and management fee of 21Shares DOGE ETF were not stated in the preliminary prospectus.

Dogecoin Foundation’s corporate arm, House of Doge, will act as a special service provider for the ETF. It would provide licensing, marketing, strategy, and related services.

Earlier this year, 21Shares partnered with the House of Doge to launch an ETP that is endorsed by the Dogecoin Foundation. The ETP, which tracks the price of Dogecoin, began trading on the SIX Swiss Exchange under the ticker “DOGE” with a 2.5% management fee.

Shortly after launching the DOGE ETP, 21Shares announced it is expanding its partnership with the House of Doge for the potential launch of its spot Dogecoin ETF in the United States.

Related Link: Exclusive: Robinhood CEO Weighs In On Biggest Crypto Opportunities, Impact Of GPT-4 On Investing

Why It’s Important: Following 21Shares' S-1 application, three asset managers are now seeking to launch spot DOGE ETFs in the U.S.

Grayscale (NYSE:GDLC) and Bitwise were the first to file with the SEC for spot DOGE ETFs. Both firms are applying to list shares of their Dogecoin ETFs on NYSE Arca. The exchange has already submitted 19b-4 filings for both funds.

The SEC acknowledged Grayscale’s 19b-4 filing in February, taking the application closer to approval.

Should the SEC approve the Dogecoin ETF, it could help contribute to the cryptocurrency’s evolution. It has been evolving beyond its meme coin origin, with top industry stakeholders like Robinhood (NASDAQ:HOOD) CEO Vladimir Tenev (NYSE:TEF) backing the coin to become the currency of the internet.

Interestingly, DOGE also aligns with the name of a U.S. federal agency, the Department of Government Efficiency (D.O.G.E.). The agency, which is being spearheaded by Tesla (NASDAQ:TSLA) CEO Elon Musk, aims to help the U.S. government cut federal spending by eliminating fraud and waste.