Key Points:

  • Grayscale Ethereum Trust to distribute Ethereum Mini Trust shares pro rata.

  • No expected tax implications for shareholders from the distribution.

  • Trading on NYSE to commence on July 23, 2024.

Grayscale Ethereum Trust announced a pro rata distribution of Ethereum Mini Trust shares with no expected tax impact, trading on NYSE starts July 23, 2024.

Grayscale Ethereum Trust Expected NYSE Arca Listing on July 23

Grayscale Investments, LLC, the Sponsor of Grayscale Ethereum Trust (ETH), announced an explanatory memorandum on the tax treatment of its pro rata distribution on the shares of the ETHE Trust.

Grayscale Ethereum Trust Announces Pro Rata Distribution and Tax Treatment

As of July 18, 2024, each holder of ETHE Shares is entitled to receive shares of Grayscale Ethereum Mini Trust shares, a Delaware statutory trust sponsored by Grayscale. The distribution, as described in the definitive information statement on Schedule 14C filed with the SEC on July 18, 2024, is part of the initial creation and distribution of ETH Shares.

According to the Information Statement, it is not expected that the ETHE Trust or any beneficial owner of ETHE Shares will recognize any gain or loss due to the initial distribution for U.S. federal income tax purposes.

Readmore: Grayscale Ethereum Mini ETF Becomes Cheapest ETF With 0.15% Annual Fee

ETHE Shares Expected to Begin Trading on NYSE Arca

The contribution of Ether to the ETH Trust and the distribution of shares in the ETH Trust to ETHE shareholders shall not be reported as income, gain, loss, deduction, credit, or proceeds. Beneficial owners of ETHE Shares receiving ETH Shares should consult their tax advisors regarding the U.S. federal income tax consequences, including the allocation of existing tax basis between ETHE Shares and ETH Shares.

Subject to regulatory approvals and customary conditions, ETH Shares will commence trading on NYSE Arca on July 23, 2024, following the Initial Distribution. ETHE Shares are also anticipated to begin trading on the same date. However, there can be no assurance that either the ETHE Shares or the ETH Shares will list and trade on the anticipated timeline.

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