Eight Firms Including BlackRock and Fidelity File for Spot Ethereum ETFs

Eight financial firms, including BlackRock and Fidelity, have recently filed S-1 amendments for their Spot Ethereum ETFs, bringing the market closer to the launch of these investment vehicles. 

These amendments reveal crucial details such as fees and seed investments, and the final approval from the Securities and Exchange Commission (SEC) is now highly anticipated.

Among the eight firms—BlackRock, Fidelity, 21Shares, Grayscale, Franklin Templeton, VanEck, iShares, and Invesco—only Franklin Templeton and VanEck have publicly disclosed their ETF fees. Franklin Templeton has set its fee at 0.19%, while VanEck has positioned itself with a slightly higher fee of 0.20%.

Eric Balchunas, a senior ETF analyst at Bloomberg, commented, “VanEck’s fee of 0.20% is quite low, putting pressure on BlackRock to keep their fee under 30bps.” This competitive pricing aims to attract investors by offering lower-cost options compared to existing cryptocurrency ETFs. With the SEC having approved the 19b-4 forms for these ETFs last month, the effective registration statements are the final hurdle before trading can commence.

Seed Investments Signal Commitment

Several firms have disclosed substantial seed investments, underscoring their commitment to these ETFs. BlackRock leads the pack with a notable $10 million seed investment, a detail that was made public prior to the recent filings. 21Shares has acquired 20,000 shares, amounting to a seed investment of $340,739. Franklin Templeton and Invesco have each disclosed seed investments of $100,000 for their respective ETFs.

These seed investments are crucial as they provide the initial capital necessary for the ETFs to begin trading. They also demonstrate the firms’ confidence in the future performance and market demand for Spot Ethereum ETFs.

The SEC’s rigorous review process ensures that all regulatory requirements are met before the ETFs can start trading. With the launch date rumored to be July 2, the market is eagerly waiting for the SEC’s final decision. The approval of Spot Bitcoin ETFs earlier this year, which featured fees ranging from 0.21% to 0.39%, has set a precedent and paved the way for the introduction of Ethereum ETFs.

The low fees proposed by Franklin Templeton and VanEck indicate a price war among issuers to offer more attractive investment options to potential investors. The lower fees could also put pressure on other firms, such as BlackRock, to maintain competitive pricing.

Global Interest in Cryptocurrency Investment Products

The enthusiasm for Ethereum ETFs extends beyond the US market. In Europe, Standard Chartered has announced the launch of a Spot Bitcoin and Ethereum trading desk, reflecting the growing global interest in cryptocurrency investment products. This international interest could potentially influence the demand and adoption of Ethereum ETFs once they receive regulatory approval in the United States.