Grayscale Ethereum Mini Trust (ETH): Buy the Big News

Liliya Filakhtova

Thesis summary

Ethereum (ETH-USD) The ETFs have been approved and nine ETFs will be available for purchase starting Tuesday, July 23.

While all of these ETFs track the price of Ethereum, there are differences between these funds that investors should consider before investing.

Fees will, of course, be the most important factor to consider.

So which ETF has the lowest fees? Which ETF will attract the most capital? And what does ETF approval mean for Ethereum and cryptocurrencies?

Ethereum ETF: Who’s in the race?

In total, nine spot Ethereum ETFs will begin trading on Tuesday, July 23.

These include: Grayscale Ethereum Mini Trust (NYSEARCA:ETH), Franklin Ethereum ETF (BATS:EZET), VanEck Ethereum ETF (BATS:ETHV), Bitwise Ethereum ETF (NYSEARCA:ETHW), 21Shares Core Ethereum ETF (BATS:CETH), Fidelity Ethereum Fund (BATS:FETH), iShares Ethereum Trust (NASDAQ:ETHA) and the Invesco Galaxy Ethereum ETF (BATS:QETH), as well as the Grayscale Ethereum Trust (NYSEARCA:ETHÉ) which will be converted into an ETF.

The wide variety of ETFs will undoubtedly pave the way for increased adoption of Ethereum, making it easier for investors to gain exposure to the asset.

However, with nine options to choose from, we need to do our due diligence to find the best option. Since all of these options will essentially track Ethereum’s performance, the main consideration here is fees.

Fees and exemptions

The list below tells us what the fees will be for each fund. Many funds will waive their fees, either completely or partially, so this is something we also need to consider.

Fees and Waivers for ETH ETFs (Fees and Waivers for ETH ETFs (ccn.com))

As we can see, six of the funds will initially charge no fees. However, these waivers are limited in terms of total assets and, most importantly, time. In most cases, fees will start to “return to normal” after 6 to 12 months.

The only two funds not to offer a fee waiver will be QETH and ETHE. ETHE will actually leave its fee level unchanged and, with a 2.5% fee, will become the most expensive ETH ETF.

Grayscale Ethereum Mini Trust: A Well-Chosen Name

Interestingly, while Grayscale will likely see notable outflows from its ETHE fund, which will become the least competitive ETF, the firm could benefit from the launch of its ETH Mini Trust.

This is effectively a “spin-off” of its ETHE fund, and something the company will also do with its Grayscale Bitcoin Trust ETF (GBTC).

But how will this work?

If you own 1,000 shares of ETHE, you will be entitled to 1,000 shares of mini ETH. While this comes from one share point, its value is significantly different.

An individual holding $1,000 of ETHE or GBTC will have $900 remaining in the original fund and $100 allocated to the newly created mini ETFs after the splits.

Source: TokenPost

In other words, when the mini fund is launched, 1/10 of the original/large fund will be converted into a mini fund, which in turn will have a share value of 1/10 of the original/large fund.

The Grayscale Ethereum Mini Trust will have 0% fees for the first $2 billion in assets, second only to iShares Ethereum Trust (ETHA), which will charge 0% fees on the first $2.5 billion in assets.

Subsequently, however, ETH will be the fund with the lowest overall fees, at just 0.15%, along with the Franklin Ethereum ETF (EZET) the next best option at 0.19%

Cheaper is better

If Ethereum’s launch is anything like the Bitcoin ETF, we should expect the funds with the lowest fees to do much better.

Comparison of BTC ETFs (Mooloo)

As it stands, the VanEck Bitcoin Trust ETF (HODL) has the lowest fees, although they will increase to 0.20% on April 1, 2025. This fund has grown 60% since its launch and has $600 million in assets under management.

The ETF with the most assets and the best performance is the iShares Bitcoin Trust ETF (I BITE), with $18.58 billion in assets under management. There are a few funds with slightly lower fees, but the iShares fund stands out as the best performer.

iShares is a very reputable and popular ETF provider, which probably also helped it secure a spot as the most popular BTC ETF.

Impact of Ethereum ETFs

The Ethereum ETF is a highly anticipated event, although it may pale in comparison to what we saw with the Bitcoin ETF launch.

Crypto market maker Wintermute predicts that the Ethereum ETF will likely attract around $3.2 to $4 billion in assets.

The firm expects Bitcoin ETFs to raise about $32 billion by the end of the year, meaning Ethereum ETFs would only receive about 10% to 12.5% ​​of the amount of assets that Bitcoin ETFs are expected to receive.

Source: DL NewsWintermute Report

The main issue here is that Ethereum ETFs will not have a staking mechanism in place. Following Ethereum’s transition to Proof of Stake, Ethereum holders with sufficient funds can stake their Ethereum and receive a return on their investment (currently yielding 3.2%).

ETFs will not have this functionality and will therefore be less attractive.

Nonetheless, Wintermute expects Ethereum’s price to increase by 18-24% as more capital flows into the asset via ETFs.

Final Thoughts

In conclusion, I believe that the Grayscale Ethereum Mini Trust fund could become the most popular Ethereum ETF. This is based on three main reasons:

• It will have the lowest fees.

• The stock price will be low (around $3).

• Grayscale has a solid reputation in the crypto world.

These three factors should combine to make it a very popular option. Everyone loves low fees, and the low share price will also help attract smaller retail investors. While Grayscale doesn’t have the same reputation as iShares, which should also do very well, I still think it’s the best option for investors.

Finally, while this is a big step in the right direction for crypto, it may not be as big as the Bitcoin ETF.

Editor’s Note: This article discusses one or more securities that are not traded on a major U.S. exchange. Be aware of the risks associated with these securities.

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