The recent approval of the Ethereum Spot ETFs by the US Securities and Exchange Commission (SEC) has sparked a flurry of activity among prospective issuers. Many asset managers have filed amended versions of their S-1 forms following the initial directive from the commission.
One of the most significant developments in this space is the revelation by Franklin Templeton, a top asset management firm, of a sponsor fee of 0.19% for its Ether spot ETF. This fee, if approved, would mean that investors have to pay $1.90 for every $1,000 invested in the fund.
Sponsor fees play a crucial role in attracting investments to ETFs. Franklin Templeton’s disclosure of its sponsor fee could set a precedent for other asset managers, who may follow suit in setting similar figures to entice investors. It is worth noting that Franklin Templeton also offers the same sponsor fee for its Bitcoin spot ETF, which is considered one of the lowest fees in the market.
Other Issuers and Their Amendments
Apart from Franklin Templeton, other issuers like VanEcK, Invesco Galaxy, Grayscale, BlackRock, and 21Shares have also submitted amended versions of their S-1 forms to the SEC. While the 19b-4 forms of these ETF applications were approved on May 23, the processing of the S-1 forms remains critical for trading to commence. However, this process may take time as the submitted forms are subject to comments from the Commission, which may require further amendments.
JPMorgan’s Projection
In a separate development, JPMorgan analysts have projected that Ethereum spot ETFs may not perform as well as their Bitcoin counterparts. They predict that these ETFs may attract investments of around $3 billion in 2024, a figure that could increase to $6 billion with the introduction of staking. For context, Bitcoin spot ETFs launched in January are currently valued at $13.69 billion, according to data from SoSoValue.
Prominent analysts like James Seyffart from Bloomberg have echoed JPMorgan’s projections, highlighting the significant difference in market cap between Ethereum and Bitcoin. At the time of writing, Ethereum is trading at $3,777 with a modest gain of 0.45% in the last 24 hours. The daily trading volume for Ethereum has also seen a 4.80% increase and is currently valued at $15.40 billion.
The approval of Ethereum spot ETFs by the SEC has set the stage for increased activity in the cryptocurrency market. With various issuers disclosing their sponsor fees and making amendments to their S-1 forms, it remains to be seen how these developments will shape the future of Ethereum ETFs and their performance in comparison to Bitcoin ETFs. Market analysts and investors alike will be closely monitoring these developments to gauge the potential impact on the overall cryptocurrency market.
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