Ethereum Spot ETF officially launched for trading in the United States.

On July 23, 2024, the United States welcomed an important milestone for Ethereum digital assets. At 9:30 AM, 9 Ethereum Spot ETFs officially began trading on the U.S. securities market. These ETFs are distributed across three major exchanges:

1. CBOE Exchange:

   • 21Shares Core Ethereum ETF (CETH)
   • Fidelity Ethereum Fund (FETH)
   • Franklin Ethereum ETF (EZET)
   • Invesco Galaxy Ethereum ETF (QETH)
   • VanEck Ethereum ETF (ETHV)

2. Nasdaq Stock Exchange:

   • BlackRock's iShares Ethereum Trust (ETHA)

3. NYSE Arca electronic trading platform:

   • Grayscale Ethereum Mini Trust (ETH)
   • ProShares Ethereum ETF (EETH)
   • Bitwise Ethereum ETF (ETHW)

In addition, regulators have approved Grayscale to convert its Ethereum Trust (ETHE) into a Spot ETF.

About 2 hours after the first trading day opened, the total turnover of these ETFs reached approximately $434 million. Among them, the Grayscale Ethereum Trust performed the best, attracting $177.2 million in capital inflow. In contrast, the 21Shares Core Ethereum ETF had the lowest turnover, at only $4.69 million.

According to reports, ETF analyst Eric Balchunas stated that the total trading volume of these ETFs reached $112 million just 15 minutes after trading began. Although this figure is much higher than that of ordinary ETF issuances, it is still only about half of the trading volume of the Bitcoin Spot ETF on its first day.

In terms of price, the VanEck Ethereum ETF opened at the highest price of $50.06. The Grayscale Ethereum Mini Trust opened at the lowest price of only $3.26, which is why it became the most traded Ether spot ETF. The average price of other ETFs mostly ranged between $20 and $30.

It is worth noting that although the ETF has started trading, the performance of Ethereum (ETH) itself has been relatively flat. As of 12:00 AM Singapore time on July 24, 2024, the daily increase of ETH was only 0.46%, with a market value of approximately $3455.2.

Characteristics and Fees of Each ETF

Although these newly launched Ethereum Spot ETFs have similar underlying principles, there are some differences in their fee structures:

• 21Shares Core Ethereum ETF: 0.21%
• Fidelity Ethereum Fund: 0.25% (No management fee for the entire year of 2024)
• Galaxy Ethereum ETF: 0.25%
• Franklin Ethereum ETF: 0.19% (First $10 billion in assets free until January 31, 2025)
• VanEck Ethereum ETF: 0.2%
• Grayscale Ethereum Mini Trust: 0.15%
• ProShares Ethereum ETF: 1.33%
• Bitwise Ethereum ETF: 0.2% (first $500 million or first 6 months free)
• Grayscale Ethereum Trust: 2.5%
• BlackRock's iShares Ethereum Trust: 0.25%

Most ETFs have fees controlled at around 0.25%, but Grayscale's fee is significantly higher than others, reaching 2.5%.

ETF and Staking

It is worth mentioning that these ETFs will not participate in Ethereum staking activities. According to reports, some institutions had previously attempted to include staking features in the ETFs, but regulators rejected this request. One main reason is that withdrawing ETH from staking typically takes several days, which does not align with the requirements for timely redemptions of ETFs.

Industry Outlook

Industry insiders are optimistic about this development. Matt Hougan, Chief Investment Officer of Bitwise, stated that we have entered the era of blockchain digital asset ETFs, and investors can now access about 70% of the digital asset market through low-cost ETFs.

Kyle DaCruz, the digital asset head at VanEck, likens Ethereum to an open-source app store, viewing it as a gateway to numerous blockchain technology applications.

According to a forecast by research firm Steno Research, these Ethereum Spot ETFs could attract between $15 billion to $20 billion in capital inflow in the first year, which is comparable to the performance of Bitcoin Spot ETFs in 7 months.