Key facts: Nine ETH-based mutual funds are expected to launch on July 23. As with bitcoin ETFs, one firm centralizes most of the custody. There is one thing that stands out among the Ethereum cryptocurrency ether (ETH) exchange-traded funds (ETFs) that are launching today in the United States. Seven of the nine that are preparing to debut have the same custodian: Coinbase. These are Grayscale Ethereum Mini Trust (ETH), Franklin Ethereum (EZET), Bitwise Ethereum (ETHW), 21Shares Core Ethereum (CETH), iShares Ethereum Trust (ETHA), Invesco Galaxy Ethereum (QETH), and Grayscale Ethereum Trust (ETHE). The only two ether ETFs that have not defined Coinbase as their custodian are VanEck Ethereum (ETHV), which established Gemini for this task, and Fildelity Ethereum Fund (FETH), which will be handled by its same issuer, Fidelity. Both maintain the same custodians that their companies have for bitcoin exchange-traded funds. (BTC). This can be seen in the following table shared by fund analyst James Seyffart. It lists the names of the Ethereum ETFs, their tickers, their commission rates, which exchange they will be listed on, and finally, their custodians.
List of Ethereum ETFs in the United States. Source: James Seyffart.
Thus, Coinbase, which is known for having one of the most globally traded crypto-asset exchanges, stands out for strengthening his position as custodian in this market. This is after it debuted as the main custodian of bitcoin ETFs launched in the United States in early 2024.
What will Ethereum ETF custodians do?
Custodians play a key role for ETFs, as they are the ones who They are responsible for storing and caring for the holdings they accumulate.. In this case, they are the ones that will safeguard the ETH they buy when they obtain capital inflows from investors. It should be noted that these ETFs are spot (cash), which means that they acquire ETH from the purchases of shares they capture. In this way, they can facilitate access to ether among traditional and institutional investors who do not want to acquire the cryptocurrency directly and self-custody the holdings in their own wallet. That is why the debut of these instruments in the United States, where the largest stock market operates, represents a door to new demand that will likely drive up the price of ETHAccording to analysts at the financial institution Citi, owner of CitiBank, ETH ETFs will attract at least 30% of the capital that BTC ETFs have garnered in the economic powerhouse. As reported by BitcoinDynamic, this is equivalent to around 5 billion dollars (USD) in the first six months.