Key Takeaways:
- Bitwise Asset Management has submitted the first-ever spot Chainlink (LINK) ETF filing with the U.S. SEC.
- The ETF would hold LINK tokens directly, with Coinbase Custody Trust serving as custodian.
- Approval could open a new wave of institutional and retail inflows into Chainlink, similar to Bitcoin and Ethereum ETFs.
Bitwise Asset Management, one of the largest digital asset managers in the U.S., has filed with the Securities and Exchange Commission (SEC) to launch the nation’s first spot Chainlink (LINK) ETF. The move signals growing momentum for crypto products that expand beyond Bitcoin and Ethereum, bringing one of the most widely used blockchain oracle tokens into the mainstream ETF market.
Read More: SEC Pauses Bitwise Crypto ETF Just After Approval; What’s Behind the Shock Decision?
Bitwise Pushes Beyond Bitcoin and Ethereum
Bitwise has played a pivotal role in ensuring that regulated crypto investment products are provided. In the wake of successfully assisting the approval of spot Bitcoin and Ethereum ETFs earlier in the year, which has unlocked billions of dollars in inflows, the company is now turning their attention to Chainlink, the 13th -largest cryptocurrency by market cap.
LINK tokens used in the proposed ETF will be safely stored in Coinbase Custody Trust, a well-known custody provider in the market. It would follow the CME CF Chainlink-Dollar Reference Rate and benchmark a transparent, measurable standard to be available to retail and institutional investors.
The LINK ETF would be the first regulated ETF in the U.S. to provide direct exposure to a decentralized oracle network, expanding the investment world of portfolio managers and potentially paving the way to other cryptocurrencies potentially as a pathfinder.
Why Chainlink and Why Now?
Chainlink is the most widespread decentralized oracle network that allows smart contracts to interact securely with the external data sources, APIs, and settlement systems. Its infrastructure supports key DeFi platforms, NFT initiatives, gaming platforms and enterprise blockchains.
Industry experts indicate that the market of secure, real-time data streams is gaining popularity as financial institutions experiment with the tokenization and use of blockchain technology. Chainlink helps to connect on-chain and off-chain worlds and, therefore, is essential to the blockchain interoperability and reliability.
Read More: Mastercard & Chainlink Launch Direct On-Chain Payments
Building on Global Momentum
Chainlink exchange-traded products (ETPs) already trade in European markets, reflecting international appetite for oracle-based investments. In its filing, Bitwise is seeking to export a similar product to U.S.-based investors, who, prior to this posting, have had no regulated product that can give them exposure to LINK other than its actual purchase on exchanges.
The time also depicts matured market conditions The positive experience of Bitcoin and Ethereum ETFs has served as a signal to the regulators and investors that crypto spot ETFs can work successfully with sufficient protection mechanisms, which will allow the introduction of other assets whose applications are not limited to the spot market, such as Chainlink.
ETF Structure and Market Impact
As stated in the filing, the Chainlink ETF would have an in-kind creation and redemption process whereby the ETF shares and LINK tokens can be exchanged directly by the authorized participants. The design, as adopted by the Bitcoin and Ethereum ETFs already, enhances liquidity, and tracking error.
The filing did not reveal the proposed ticker symbol, the exchange listing venue, or say, how much it would charge to manage the fund, but it has maintained that Coinbase Custody will be the custodian of the funds.
Historically, ETF approvals have served as major catalysts for price appreciation and liquidity expansion. Following the announcement, LINK briefly gained more than 4%, trading near $24.18, extending a 26% rally over the past 30 days. Analysts suggest that a greenlight from the SEC could accelerate this trend, enabling retirement funds, family offices, and institutional managers to allocate to Chainlink through a familiar, regulated product.
The Broader Regulatory Context
The filing comes as a tide of ETF applications in crypto has been unleashed in an increasingly welcoming regulatory environment. Recent changes to the U.S. enforce the more crypto-friendly general approach that has seen the U.S. administration urging issuers to drive the availability of additional categories of digital asset ETFs.
Bitwise recently reported that it is managing around $2.26 billion in Bitcoin and around 460 million Ethereum as of the ETF products. By integrating Chainlink, the firm would diversify its product offering and be one of the industry leaders in broad-spectrum crypto assets.
Regulators are also put under pressure to offer clear frameworks of digital assets across the board beyond Bitcoin and Ethereum. The success of a Chainlink ETF may suggest that a tokenized ecosystem of decentralized infrastructure is valued as a commodity that can warranty blockchain environments in the future.
