The world of cryptocurrency is about to experience a significant shift as nine spot Ethereum ETFs are set to launch on July 23. After years of regulatory challenges and countless amended filings, these ETFs are finally making their debut, offering new investment opportunities to millions of institutional and retail investors in the United States.
The Anticipated Launch
On July 23, shares of publicly-traded Ethereum ETFs will be listed alongside household names like Apple Inc (AAPL) and SPDR S&P 500 ETF Trust (SPY) on major U.S. exchanges. This is a defining moment for the cryptocurrency market, signaling its growing acceptance and integration into mainstream finance.
Where to Buy
Investors will be able to purchase Ethereum ETFs through major brokerage platforms such as Fidelity, E*TRADE, Robinhood, Charles Schwab, and TD Ameritrade. These platforms act as intermediaries, allowing everyday investors to trade on exchanges like the Chicago Board Options Exchange (CBOE), Nasdaq, and NYSE Arca.
The ETFs to Watch
The CBOE will list five of the nine ETFs: 21Shares Core Ethereum ETF, Fidelity Ethereum Fund, Invesco Galaxy Ethereum ETF, VanEck Ethereum ETF, and Franklin Ethereum ETF. The other four ETFs are expected to list on Nasdaq or NYSE Arca, although official announcements are still pending.
Choosing the Right ETF
With nine options available, investors might wonder which ETF to choose. The differences primarily lie in management fees, which range from 0.15% to 0.25% for most ETFs. Grayscale Ethereum Trust (ETHE) stands out with a higher fee of 2.5%, having launched under a different structure in 2017.
To attract investors, many ETFs are offering temporary fee waivers. For example, the Grayscale Ethereum Mini Trust boasts the lowest fees at 0.15%, waived for the first six months or until the fund reaches $2 billion in assets under management (AUM). Similarly, Franklin Templeton’s Franklin Ethereum ETF offers a 0.19% fee, waived through January 2025 or until the fund hits $10 billion in AUM.
The Staking Question
One question on many investors’ minds is whether these ETFs will offer staking. Currently, the answer is no. Staking, which involves depositing ETH to a validator node on Ethereum’s Beacon Chain to earn rewards, presents liquidity challenges. ETF issuers need to promptly redeem shares for underlying assets, a requirement that staked ETH’s withdrawal time complicates. While some issuers are exploring solutions, such as maintaining a buffer of liquid spot Ether, it will be several months before staking could potentially be integrated.
A New Era for Ethereum
The introduction of these ETFs marks a significant milestone in the evolution of cryptocurrency markets. By making Ethereum more accessible to mainstream investors, these ETFs could help drive broader adoption and understanding of digital assets. As the July 23 launch date approaches, investors should prepare to seize this opportunity and be part of this exciting new chapter in the world of crypto investing.