21Shares, one of the world’s leading issuers of cryptocurrency exchange-traded products (ETPs), has integrated Chainlink’s Proof of Reserve (PoR) on Ethereum to increase the transparency of their Core Ethereum ETF (CETH). This strategic move aims to bolster investor confidence by ensuring that CETH is backed by physical Ethereum holdings.
21Shares Adopts Chainlink’s Proof of Reserve
In a recent press release, 21Shares US LLC announced the integration of Chainlink’s industry-standard PoR on the Ethereum mainnet. This implementation allows investors to verify that CETH is supported by actual Ethereum reserves. The data, sourced directly from Coinbase custody, is accessible through a Chainlink feed, providing real-time insights into the ETF’s holdings.
Exciting news! 21Shares has integrated @Chainlink Proof of Reserve (PoR) on Ethereum to increase the transparency of the 21Shares Core Ethereum ETF’s (CETH) reserves.
This integration of Chainlink's Proof of Reserve ensures investors have real-time visibility into the Ethereum… pic.twitter.com/OivK5OASPS
— 21Shares US (@21shares_us) July 29, 2024
Boosting Transparency and Investor Confidence
Nate Geraci, President of ETFStore, highlighted the significance of this transparency by sharing a screenshot of the CETH reserve. According to Geraci, this development offers a clear view of the Ethereum assets backing the ETF.
The press release from 21Shares outlines the rationale behind selecting Chainlink’s PoR. Chainlink was chosen due to its robust track record, enabling over $12 trillion in on-chain market value. This integration not only ensures transparency but also enhances security, maintains asset integrity, and builds trust among investors. By eliminating intermediaries, Chainlink’s PoR feed provides decentralized, automated on-chain verification, ensuring that data remains current and accurate.
21Shares Core Ethereum ETF has integrated Chainlink’s Proof of Reserve platform…
Offers transparency into the ether backing ETF. pic.twitter.com/J5M4GqCFgJ
— Nate Geraci (@NateGeraci) July 29, 2024
Significance for Crypto Investors and Market Integrity
As of now, 21Shares holds 2,800 ETH in their reserve for the CETH ETF. The firm has previously integrated Chainlink PoR for their ARK Bitcoin ETF (ARKB) in February 2024. ARKB, a prominent Bitcoin spot exchange-traded product, currently manages $3.2 billion in assets.
In a Twitter post, 21Shares US shared extensive details about the integration, emphasizing that the fund is not registered under the Investment Company Act of 1940. They also noted that the fund, unlike other ETFs, may not be suitable for all investors due to the inherent volatility and risks associated with single-asset trusts. Interested parties can access the 139-page ETH ETF Prospectus for further information.
What are your thoughts on the integration of Chainlink’s Proof of Reserve by 21Shares? Share your opinion in the comments below.
