Spot Ethereum ETFs, which received initial approval from the SEC at the end of May, are set to begin trading today. In anticipation of this, Grayscale, one of the ETF issuers, transferred $1 billion worth of ETH to Coinbase last night.
This significant move by Grayscale has led to speculation among investors about a possible sale of ETH. However, experts suggest that the transfer is not indicative of a sale.
Jon Campagna, manager of crypto hedge fund company Nexyst Digital, told Decrypt that the transfer was not intended for sales purposes.
Amid rumors that Grayscale might sell ETH to invest in other cryptocurrencies like Solana (SOL), Campagna clarified that the transfer was from the Grayscale Ethereum Trust (ETHE) to the Grayscale Ethereum mini ETH ETF.
He reminded that on July 18, Grayscale allocated 10% of ETHE assets for the new ETF, saying:
“The sale doesn’t make sense. On July 18, Grayscale allocated 10% of ETHE assets for the new ETF. They announced that ETHE holders would receive 10% of their assets when the ETF begins trading. With ETHE's asset value at $10 billion, 10% equates to $1 billion. Hence, this ETH transfer was made in preparation for the ETH ETFs. They’re not selling ETH or buying Solana.”
Campagna also mentioned that there would be outflows from the Grayscale Ethereum Trust due to high transaction fees, but these would likely shift to other ETFs, particularly Grayscale’s mini-Ethereum fund.
Bloomberg senior ETF analyst Eric Balchunas echoed this, stating that the transfer is not a sale but a transition from the Grayscale Ethereum Trust to the Grayscale Ethereum mini ETH ETF.
Following a similar pattern seen with Spot Bitcoin ETFs, Grayscale made substantial Bitcoin (BTC) transfers after the launch of BTC ETFs. #ETH #ethereum #ETFs #CryptocurrencyNews #cryptocurrencies