BlackRock proposes a 0.25% fee for its spot Ethereum ETF, initially waived upon launch.
Franklin Templeton, Bitwise, and VanEck offer lower fees, with waivers ranging from six months to one year.
SEC approvals for Ether ETFs could lead to significant crypto market shifts, potentially triggering an altseason.
BlackRock is preparing to launch its spot Ethereum exchange-traded fund (ETF) next week, proposing a fee of 0.25%. The fee will be accrued daily and payable at least quarterly, either in US dollars, in-kind, or both. Initially, BlackRock plans to waive this fee upon launch, following the strategy used for its iShares Bitcoin Trust.
Okay everyone. Here are the details for the #Ethereum ETFs that we expect to launch next week. We are only missing details for Proshares's ETF. 7 of the 10 funds have fee waivers. pic.twitter.com/5v3QnHOeub
— James Seyffart (@JSeyff) July 17, 2024
Fee Structures and Waivers
Other firms have disclosed their proposed fees and waiver periods amidst a surge of amended S-1 registration forms. Franklin Templeton plans to charge a fee of 0.19%, while Bitwise and VanEck have set their fees at 0.20%. The 21Shares Core Ethereum ETF will have a fee of 0.21%, and Fidelity and Invesco Galaxy will match BlackRock’s 0.25% fee.
Several issuers, including Bitwise, Fidelity, Franklin Templeton, 21Shares, and VanEck, have proposed to waive their fees at launch. VanEck’s waiver will last for the first 12 months or until the fund reaches $1.5 billion in assets.
Bitwise will waive its fee for six months or until it reaches $0.5 billion in assets, while Franklin Templeton’s waiver extends to January 31, 2025, or a $10 billion threshold. Fidelity’s waiver will last until January 1, 2025, after which the fee will increase to 0.25%.
Preliminary Approvals and Anticipated Launch
Reports indicate that BlackRock, Franklin Templeton, and VanEck have already received preliminary approval from the U.S. Securities and Exchange Commission (SEC). Bloomberg ETF analyst Eric Balchunas expects the S-1s to be approved next Monday after trading hours, with spot Ether ETFs potentially starting to trade on Tuesday, July 23.
The SEC has approved the Grayscale Ethereum Mini Trust and ProShares Ethereum ETF, allowing them to list and trade on the NYSE Arca Inc. This approval is subject to final notice and comment of the S-1 filings. Bloomberg’s ETF researcher James Seyffart suggests that several spot Ether ETF issuers might begin trading next week.
Market Impact
The listing and trading of spot Ether ETFs in the U.S. are expected to impact the crypto industry. Grayscale has announced the launch of its Grayscale Decentralized AI Fund, which will invest in various cryptocurrencies. The influx of billions of dollars into the Ethereum market may trigger an anticipated altseason, with other spot crypto ETFs, such as Solana (SOL), expected to follow.
Bitcoin and Altcoin Market Shifts
On-chain data indicates a decrease of over 600,000 non-zero Bitcoin addresses in the past month, a shift of crypto assets to altcoins. From a technical perspective, Bitcoin dominance has shown signs of a macro reversal, supported by a weekly bearish divergence on the Relative Strength Index (RSI).
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