VanEck to offer no-fee Ethereum ETF until 2025

The cryptocurrency industry is welcoming more spot Ethereum exchange-traded funds (ETFs) into its ecosystem. Most recently, VanEck filed Form 8A for its Ethereum spot ETF. Several market analysts were expecting July 2 as the launch date for these funds. Along with this, VanEck was trying to stay ahead of the curve by waiving ETF fees altogether.

According to a recent email from Matthew Nigel, head of digital assets at VanEck, the firm will not charge fees for its Ethereum ETF. It’s unclear how long this will last, but it will likely last until 2025. But the fund’s fee-free structure will end if its assets reach $1.5 billion before that deadline. After that, the fund will have a fee of 0.20%.

Eric Balchunas, ETF analyst at Bloomberg, said that issuers rarely disclose their fee structure this early, before the launch period. However, VanEck was not the only company to do so. Franklin Templeton previously indicated that it would charge a 0.19% fee for its Ethereum spot ETF. Speaking about the same, Balchunas said:

“What BlackRock is going to charge is probably the most missing variable outside of the exact launch date. Their reward is the sun around which the others must orbit. It must be nice.

Also Read: Ethereum ETF Demand Must Be Less Than Bitcoin, Says Bernstein

Why does VanEck opt for “zero fees”?

It appears that VanEck is aware of the loss it would incur by launching the no-fee initiative. In the email sent to ETF.com, Sigel said:

“(VanEck) aims to be a leader in crypto ETF fees even if it means we lose money up front. The plan is to catch up on volume; in this case, volume of decentralized financing.

Amid this, ETH was trading at $3,382.65 after a 5% decline over the past seven days.

Also Read: SEC Chairman Gensler Says Ethereum ETF Approval Is Going Smoothly