Giant asset management company VanEck is taking the final steps to launch an Ethereum (ETH) spot exchange-traded fund (ETF) by submitting Form 8-A.
Separately, Van Eck has decided to waive all fees for the upcoming Ethereum spot ETF. This strategy aims to attract a broad range of investors and solidify VanEck's position in the highly competitive spot cryptocurrency ETF market.
VanEck's Form 8-A submission fuels speculation of launch of Ethereum spot ETF
On June 25, Van Eck filed Form 8-A with the U.S. Securities and Exchange Commission (SEC), an important step for companies aiming to register as securities. Formally known as the Registration of Certain Classes of Securities, this form is an essential document for entities listing securities on an exchange. It serves as a short form registration statement under the Securities Exchange Act of 1934 and allows a company to offer its securities to the public.
Read more: Ethereum ETF explained : What it is and how it works
The timing of VanEck's 8-A filing has sparked discussion and speculation in the cryptocurrency community. Eric Balchunas, senior ETF analyst at Bloomberg Intelligence, likened VanEck's Bitcoin (BTC) ETF 8-A filing.
“It is important to note that we filed our 8-A for spot Bitcoin [ETF] 7 days prior to launch. This is a good sign for the July 2 Over/Under (7 days from now). But again, anything is possible. Of course, you will hear more soon,” Balchunas said .
At the same time, the New York-based company said it would initially waive fees on its spot Ethereum ETF until 2025 or until the fund's assets reach $1.5 billion. Matthew Siegel, head of digital asset research at VanEck, shared more details about this decision.
“VanEck aims to become a leader in cryptocurrency ETF fees, even if it incurs initial losses. […] […] The plan is to make up for it with trading volume, that is, decentralized finance trading volume. […] […] More on-chain activity = more Ethereum gas consumption = higher Ethereum price = VanEck Ethereum backup,” Siegel explained .
The ETF's final fee is very competitive at 0.20%, allowing you to raise a significant investment quickly. This approach is similar to VanEck's strategy of running a spot Bitcoin ETF that waives fees until the fund reaches significant assets.
With Van Eck and Franklin Templeton disclosing their costs, competitors' fee strategies are stepping up.
Van Eck is not alone in the race to launch an Ethereum ETF . Franklin Templeton previously disclosed fees for its Ethereum ETF at 0.19% . Experts believe this proactive fee disclosure could put pressure on BlackRock and other competitors to lower fees.
“We can put pressure on BlackRock to stay below the 30 bps minimum. For now, it appears that Ethereum’s fees will be lower or lower than Bitcoin’s,” says Balchunas.
Despite the fee war, many believe that spot Ethereum ETFs are less attractive considering that all potential issuers exclude the staking aspect . In general, Ethereum investors can earn additional profits by staking their Ethereum holdings. This offers more benefits than spot exposure alone.
Read more: How to invest in Ethereum ETF?
Nonetheless, ETFs appeal to institutional investors by providing a regulated and convenient way to gain exposure to Ethereum without direct ownership and complex staking. Additionally, market experts and industry players believe that if a spot Ethereum ETF is approved, it could pave the way for other cryptocurrency ETFs such as Solana (SOL) to emerge. Ultimately, this will lead to wider adoption of cryptocurrencies in the mainstream.
