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What did we learn from BlackRock’s Ethereum SEC S-1 filing today?

What did we learn from BlackRock's Ethereum SEC S-1 filing today?

BlackRock, the world’s largest asset manager, has filed its S-1 registration statement and prospectus with the Securities and Exchange Commission (SEC) for the anticipated Ethereum exchange-traded fund (ETF).

Quick Take

  • BlackRock’s Ethereum ETF will be called the iShares Ethereum Trust and will directly hold Ethereum.
  • Coinbase Custody Trust Company is named as the custodian for Ethereum.
  • An unnamed custodian will hold cash.
  • The ETF seeks to track the price of Ethereum before fees and expenses.
  • The NAV will be calculated using the CME CF Ether-Dollar Reference Rate index.
  • The sponsor has discretion on how to handle forks, airdrops, and can abandon assets from these events.
  • The management fee was left blank in the current filing, along with additional expenses.
  • Ethereum will be sold periodically to cover fees, creating tax events.
  • The ETF plans to list on the Nasdaq under an unnamed ticker.
  • No launch date is provided.

BlackRock Ethereum ETF breakdown.

According to the filing, the proposed ETF will be called the iShares Ethereum Trust and will track the price of Ethereum, the native cryptocurrency of the Ethereum blockchain. The ETF will be structured as a grantor trust and hold Ethereum on behalf of investors. The trust will issue shares representing fractional undivided beneficial interests in its net assets, consisting primarily of Ethereum. The filing states the ETF seeks to reflect the performance of the Ethereum price before fees and expenses.

The sponsor of the proposed ETF is iShares Delaware Trust Sponsor LLC, a subsidiary of BlackRock. Key service providers named in the filing include BlackRock Fund Advisors as the trustee, Coinbase Custody Trust Company as the custodian for Ethereum holdings, and an unnamed custodian for cash holdings.

BlackRock outlined several benefits of investing in the ETF compared to direct ownership of Ethereum. These include avoiding the complexities of digital asset wallets and keys, the convenience of trading through traditional brokerage…

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