What information does the latest ETH ETF filing reveal?

 Author: Ben Strack Source: blockworks Translation: Shan Ouba, Golden Finance

The fee war is about to break out, Ark Investments temporarily abandons cooperation with 21Shares to enter the spot Ethereum ETF market, a new batch of revised spot Ethereum ETF applications have been submitted, and at least one more round of submissions is expected before the product is officially launched.

The latest documents show that there may be another fee war in the future and reveal that one issuer has decided to focus more on Bitcoin.

Although the U.S. Securities and Exchange Commission (SEC) approved the 19b-4 proposals submitted by Cboe, NYSE Arca and Nasdaq to list these funds on May 23, the regulator is now in the final step - completing the approval of the S-1 registration statement.

On Wednesday, BlackRock disclosed its fund's $10 million start-up capital and authorized participants. However, as more applications poured in late Friday night, one of the big takeaways was that the planned fees for the Franklin Templeton Ethereum Fund were set at 0.19%. The firm, which manages $1.6 trillion in assets, was the first to disclose its proposed fees, setting the stage for an expected fee war similar to the one that took place among Bitcoin ETF issuers in January. Franklin Templeton crushed Bitwise to become the cheapest Bitcoin ETF by slashing its price the day after the funds launched in January. ETF Store President Nate Geraci said he expects the fee war for spot Ethereum ETFs to be as fierce and brutal as the fee war surrounding BTC funds, and the two battlefields are closely linked. "Fee competition in one category can affect the other because ultimately investors will expect pricing to be similar between the two," Geraci told Blockworks.

Sumit Roy, senior analyst at ETF.com, said fee waivers could come into play again, with the perpetual expense rate potentially going as low as 0.15%. "0.19% is already very low, but I wouldn't be surprised to see even lower fees at some point in the future," Roy said.

Another major finding of the filing is the absence of any mention of Ark Investors by name. The disruptive innovation-focused firm previously partnered with 21Shares in January to launch a spot bitcoin ETF. The Ark 21Shares Bitcoin ETF (ARKB) has about $3.2 billion in assets under management.

A spokesperson for 21Shares confirmed that the fund will continue to attempt to launch the 21Shares Core Ethereum ETF without Ark Investors as a partner. The representative noted that the two companies remain "partners" for ARKB and a range of futures-based products.

A spokesperson for Ark Investors told Blockworks via email that the company believes bitcoin is a "public good that everyone should be able to access at a low cost."

“As for Ethereum, Ark Investors believes in its transformative potential and the long-term value of the Ethereum blockchain, but at this time, Ark Investors will not move forward with an Ethereum ETF,” the representative added. “We will continue to evaluate efficient ways to provide our investors with exposure to this innovative technology to fully leverage its benefits.”

One ​​benefit missing from the currently planned spot Ethereum ETFs is yield earned through staking — the process of depositing ETH to help secure the Ethereum blockchain.

The efforts of all issuers to submit revised S-1s by the end of last week suggest that these funds are preparing to launch as planned.

A person familiar with the filing told Blockworks that the SEC has provided “informal guidance” to issuers to comment on their S-1 revisions by the end of this week.