Grayscale’s ETHE Discount Narrows
The Grayscale Ethereum Trust (ETHE) has seen significant gains following the filing of applications for a spot Ethereum exchange-traded fund (ETF) by ARK Invest and VanEck. Despite a drop in ETH price, the ETHE discount to net asset value (NAV) has narrowed to 26%, according to blockchain intelligence firm IntoTheBlock.
Following Ark’s spot ETH ETF filing, Grayscale’s ETH fund is close to its yearly highs, even while Ether itself is down over 20%.
Here’s what’s going on👇➡️ ETHE has increased by over 140% in 2023, significantly narrowing its discount to the underlying Ether it holds
➡️ The… pic.twitter.com/PIROEgYVuT— IntoTheBlock (@intotheblock) September 8, 2023
On September 6, ARK Invest filed with the United States Securities and Exchange Commission (SEC) to launch the first spot Ether ETF in the country. The ETF, called ARK21Shares Ethereum ETF, will track the performance of ETH. Coinbase will serve as the custodian of the product, holding all of the fund’s ETH, while 21Shares is the trust’s sponsor. ARK Invest will be the sub-adviser and handle the marketing of the ETF’s shares.
Despite the announcement causing bitcoin (BTC) and ETH to briefly rise before returning to their previous levels, ETHE has continued to make progress. IntoTheBlock reports that ETHE has narrowed its discount to underlying ETH by over 140% in 2023. The discount began decreasing in June after BlackRock and other traditional finance giants filed for a spot Bitcoin ETF. It decreased from -56% to -36% that month and has now reached -26%, its lowest level since October 2022. This trend suggests that the crypto market is considering the possibility of Grayscale converting ETHE into an ETF.
Launching the First U.S. Spot Ether ETF
The race to launch the first spot Ether ETF comes as the crypto community awaits the SEC’s approval for several applications seeking to launch a spot Bitcoin ETF. Grayscale’s recent victory in a legal battle with the SEC over a spot Bitcoin ETF could potentially influence the regulator’s decision. Analysts estimate that the SEC may approve the filings for a spot Ether ETF by May 23, 2024.
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About the author - J-S Tremblay
I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...
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