Following the unexpected approval of spot Ethereum exchange-traded funds (ETFs) in May, and some final touches to regulatory paperwork, the long-awaited products started trading today.
An ETF is a popular investment vehicle that allows investors to buy shares that track the price of an underlying asset. This could be anything from gold and foreign currencies to crypto and tech stocks. Such funds trade on stock exchanges.
The U.S. Securities and Exchange Commission (SEC) shocked traditional and crypto markets when it finally said yes to 11 spot Bitcoin exchange-traded funds in January. The approval—which came after a decade of denials—led to a flood of capital into the Bitcoin space.
Industry experts had expected the SEC to be slower in approving the Ethereum equivalents following the regulator’s reticence—but it quietly and quickly approved the funds. Now, two months after initial approvals, the spot ETFs began trading on Tuesday, July 23.
Here are the products now trading on U.S. stock exchanges.
BlackRock
BlackRock’s iShares Ethereum Trust (ETHA) is now trading on the Nasdaq after the company first filed an S-1 form for the product back in November.
https://www.youtube.com/watch?v=se1bcqMYg8g
The firm’s CEO, Larry Fink, is apparently enthusiastic about ETH and its network, and has said that there is “value in having an Ethereum ETF.” He has also talked about the “tokenization” of real-world assets being inevitable.
Grayscale
Crypto asset manager Grayscale got a yes from the SEC after filing a proposal in October to convert its Grayscale Ethereum Trust into a spot Ethereum ETF.
Formerly operating like a closed-end fund, Grayscale Ethereum Trust (ETHE) is now trading as an ETF on the NYSE Arca. Its Bitcoin Trust converted into an ETF in January, so there was already precedent for how such a crypto vehicle can transition over to a spot ETF.
But it isn’t the only Ethereum product the asset manager will release: a mini Ethereum ETF also got the green light last week and is now trading under the “ETH” ticker.
The mini trust is seeded with assets currently backing the main, bigger ETF, and has lower fees for investors than its original proposed product at 0.15%. The Grayscale Ethereum Mini Trust (ETH) will also waive its fees for six months or until it hits an assets under management (AUM) mark of $2 billion.
Greg Cipolaro, Global Head of Research at NYDIG, argued in a research note shared with Decrypt that Grayscale’s mini Ethereum ETF represents a “strategic move” by the asset manager. “Unlike the launch of Bitcoin ETFs, where a low-cost ‘accumulation’ fund was lacking, Grayscale is now positioned to compete for inflows,” he said, adding that ETF providers will likely compete based on marketing and distribution rather than fees.
Grayscale is a big part of the reason why Bitcoin ETFs are trading in the U.S. right now. In a landmark moment for the crypto industry last year, a judge sided with the firm in a lawsuit, agreeing with the firm that Wall Street’s biggest regulator lacked a coherent explanation for denying its proposed conversion to a Bitcoin ETF after years of denials.
The ruling paved the way for the SEC to give the green light to spot Bitcoin ETFs.
21Shares
Cathie Wood’s heavyweight tech investment management firm, ARK Invest, filed a proposal with the SEC for an Ethereum ETF back in September.
The proposed ETF was launched in partnership with crypto ETF issuer 21Shares, naming Coinbase, America’s biggest digital asset exchange, as its custodian—meaning that the recognized company would hold and store the ETH in the product.
But in June, ARK Invest ended its partnership with 21Shares on the spot Ethereum ETF, leaving the crypto ETF issuer to go it alone. The rebranded 21Shares Core Ethereum ETF (CETH) launched today and charges a fee of 0.21%, which it will waive for six months or until its AUM hits $500 million.
Fidelity
Financial services giant Fidelity made it clear that it wanted to drop an Ethereum ETF back in November when Cboe—the exchange where the product would trade—filed a 19b-4 on behalf of the firm.
Then, in March, the massive firm filed its S-1 with the SEC for its Fidelity Ethereum Fund (FETH), which is now trading as of Tuesday. FETH charges a fee of 0.25%, which it will waive until the end of 2024.
VanEck
Asset manager VanEck was the first fund manager to file a proposal for an Ethereum ETF with the SEC back in 2021. The firm withdrew its proposal later that year, but then filed again.
The firm’s Bitcoin ETF has been a successful product, and VanEck even waived its fees to better compete with the other funds on the market. Its Ethereum ETF (ETHV) is now trading on the Cboe. It’s taking a similar approach…
Read More: These Are All the Ethereum ETFs Now Trading in the US