- The 21Shares Core Ethereum ETF has filed a Preliminary Prospectus, announcing its plans to list on the Cboe BZX Exchange.
- ARK has been dropped from the Ethereum ETF but remains a partner in other Bitcoin and futures ETFs.
- The ETF will not charge any fees, indicating a potential fee war pause in the crypto ETF space.
The 21Shares Core Ethereum ETF aims to track the performance of ether with no fees, reflecting a strategic shift and partnership changes in the crypto ETF market.
21Shares Core Ethereum ETF: Key Highlights and Investment Objective
The newly proposed 21Shares Core Ethereum ETF (“the Trust”) is set to be listed on the Cboe BZX Exchange, Inc. This ETF is designed to track the performance of ether, utilizing the CME CF Ether-Dollar Reference Rate – New York Variant (the “Index”). The Trust’s strategy involves holding ether and valuing its shares daily based on the Index. The ETF aims to provide investors with exposure to ether’s performance in U.S. dollars, minus the Trust’s expenses and other liabilities. CF Benchmarks Ltd. serves as the Index Provider, ensuring accurate and reliable performance tracking.
Partnership Changes: ARK No Longer Involved in Ethereum ETF
One notable change in this Preliminary Prospectus is the absence of ARK Invest from the Ethereum ETF’s name and management. While ARK continues to collaborate with 21Shares on other financial products, including Bitcoin ETFs and futures, they have decided not to proceed with the Ethereum ETF at this time. ARK’s statement highlights their belief in the long-term value of Ethereum and their ongoing evaluation of efficient ways to provide investor exposure to this transformative technology.
No Fee Structure: Implications for the Crypto ETF Market
A significant aspect of the 21Shares Core Ethereum ETF is its zero-fee structure. The decision to forgo management fees could signal a temporary halt in the competitive fee reductions seen across the ETF market. This strategy might attract more investors looking for cost-effective ways to gain exposure to Ethereum. The ETF’s fee-free approach aligns with the broader trend of reducing investment costs and increasing accessibility to digital assets.
ARK’s Commitment to Bitcoin ETFs and Future Plans
Despite withdrawing from the Ethereum ETF, ARK remains committed to its existing Bitcoin ETF, the ARK 21Shares Bitcoin ETF (“ARKB”). ARK emphasizes its dedication to providing low-cost access to Bitcoin, viewing it as a public good. The company continues to focus on its core strength of active management, offering a variety of innovative products, including disruptive innovation equity ETFs, digital asset futures ETFs, and private funds like the ARK Venture Fund.
Conclusion
The launch of the 21Shares Core Ethereum ETF without ARK Invest’s involvement marks a significant development in the crypto ETF landscape. The zero-fee structure sets it apart, potentially attracting a broader investor base. As the ETF prepares for its listing on the Cboe BZX Exchange, the market will be closely watching its performance and impact. ARK’s decision to step back from the Ethereum ETF, while continuing to support Bitcoin and other disruptive technologies, highlights their strategic focus and commitment to innovation. Investors can expect further developments as both 21Shares and ARK continue to navigate the evolving crypto market.
