In Anticipation of Ether ETF Approval, Most Applicants Have Submitted Their Final Forms
In Anticipation of Ether ETF Approval, Most Applicants Have Submitted Their Final Forms The forms reveal issuer fee plans, with Grayscale at the high end charging 2.5%, while competitors such as BlackRock and Fidelity opt for 0.25% or less.
Prospective issuers of spot Ethereum exchange-traded funds (ETFs) have submitted their final S-1 documents to the U.S. Securities and Exchange Commission (SEC). Upon approval by the regulator, these funds are expected to enter the market.
According to sources familiar with the matter speaking to CoinDesk earlier this week, the SEC is likely to approve these documents next Tuesday. Asset management firms including BlackRock, Fidelity, 21Shares, Grayscale, Bitwise, and Invesco Galaxy, all vying to launch Ethereum ETFs in the U.S., filed amended S-1 filings on Wednesday.
Sources previously indicated that SEC staff advised applicants to submit final amendments by Wednesday, with potential approval by Monday and trading commencement by Tuesday.
In their filings, these issuers disclosed the fund structures’ final details, particularly management fees, which are crucial for investor consideration. This mirrors the fee competitiveness seen earlier this year with spot Bitcoin ETF launches, where fees were continually lowered to attract investors.
One notable divergence is Grayscale’s fee structure, with its main product charging a higher fee of 2.5% compared to competitors. However, its Mini Ethereum Trust aligns with others at 0.25%.
Industry commentator Scott Johnson expressed skepticism about Grayscale’s strategy, suggesting potential investor backlash given the fee disparity. He drew parallels to Grayscale Bitcoin Trust (GBTC), which experienced substantial outflows after converting to an ETF earlier this year.
BlackRock and Fidelity are also set to charge 0.25%, while 21Shares opted for 0.21%. Bitwise, VanEck, and Invesco Galaxy positioned themselves at the lower end with fees of 0.2%, and Franklin Templeton at 0.19%.
ProShares had not disclosed its fee amendment at the time of reporting.
Is a Mini ETF Launch Imminent?
On Wednesday, the SEC approved 19b-4 forms for Grayscale’s application to launch a mini Ethereum exchange-traded product and ProShares’ application to launch a spot Ethereum ETF. Both companies are partnering with NYSE Arca, which will list these products. Earlier in May, the SEC had approved 19b-4 forms from NYSE Arca, Cboe, and Nasdaq, clearing a procedural hurdle and signaling potential approval for spot Ethereum ETF applications.
The timing of these 19b-4 approvals on Wednesday suggests that Grayscale and ProShares may launch their products concurrently with other applicants. According to industry sources cited by CoinDesk, these launches are anticipated to occur next Tuesday.
If Grayscale proceeds to launch its mini Ethereum ETF on Tuesday, it would do so before obtaining approval for a mini Bitcoin ETF. Earlier this year, Grayscale disclosed plans for a mini Bitcoin ETF with a proposed fee of 0.15%, contrasting with the 0.25% fee set for the mini Ethereum product.
