Ethereum ETFs Near Launch as Major Firms Amend SEC Filings, Fee Wars Expected

On June 21, seven Ethereum ETF applicants, including Franklin Templeton, VanEck, Invesco Galaxy, BlackRock, 21Shares, and Fidelity, amended their registration statements with the SEC, raising expectations for a trading launch in early July.

The updated filings included an S-3 amendment for Grayscale's Ethereum Trust and an S-1 amendment for its mini Ethereum Trust. Bitwise did not amend its registration statement.

Bloomberg ETF analyst Eric Balchunas reiterated his prediction of a July 2 launch date following these amendments, noting, "Anyway that’s basically a wrap. Ball in SEC’s court now." He also suggested that Ethereum ETFs would likely attract less than 20% of the assets under management (AUM) seen by Bitcoin ETFs.

Fee disclosures revealed Franklin Templeton's 0.19% sponsor fee, waived for the first $10 billion in assets for six months, and VanEck's 0.20% fee, waived for the first $1.5 billion in assets until an unspecified date in 2025. Balchunas anticipates that these low fees will pressure BlackRock to set its fees below 30 basis points. Both BlackRock and Fidelity have yet to disclose their sponsor fees.

Experts emphasize the significance of BlackRock's fee, with Balchunas stating, "[BlackRock’s] fee is the sun that the rest will need to orbit around." The introduction of spot Bitcoin ETFs in January sparked a "fee war" among issuers, with current fees ranging from 0.19% to 0.39%, except for Grayscale’s GBTC, which charges 1.5%.

In terms of seed investments, Invesco Galaxy disclosed a $100,000 seed transaction on June 17, purchasing 4,000 shares at $25 each. Grayscale reported a $100,000 seed purchase for its mini Ethereum trust, with the sponsor buying 10,000 shares at $10 each on May 31. Fidelity's seed capital investor, FMR Capital, bought 125,000 shares at $37.99 each on June 4, contributing $4.7 million to the trust. BlackRock had previously disclosed $10 million in seed funding for its ETF.