Fidelity seeds Ethereum ETF with $4.7 million 😱💸

Fidelity Seeds Ethereum ETF with $4.7 Million

Recently, Fidelity, the world’s fourth-largest asset manager, filed a regulatory document revealing its plan to seed its upcoming Ethereum ETF with $4.7 million. This move demonstrates Fidelity’s confidence in the fund and provides liquidity for initial buyers. Let’s dive into the details of this development:

Fidelity’s Initial Investment

Here are some key points regarding Fidelity’s investment in the Ethereum ETF:

The regulatory filing indicated that the total proceeds from the sale of seed baskets amounted to $4,749,975.
Fidelity used these proceeds on June 4 to purchase 1,250 ETH, securing 125,000 shares at $38 each.
When Fidelity launched its Bitcoin ETF earlier this year, it seeded the fund with $20 million.

Competition in the ETF Space

Competitors in the ETF space are also making significant moves:

Bitwise recently seeded its Ethereum ETF with $2.5 million and mentioned the possibility of Pantera Capital Management buying $100 million worth of shares.
BlackRock has decided to seed its funds with $10 million, aligning with its initial investment in the Bitcoin fund.
Franklin Templeton revealed that its Ethereum fund’s management fee will match its Bitcoin product at 0.19%, making it the most affordable option compared to other Bitcoin and Ethereum ETFs currently available.

Predictions on ETF Performance

Analysts have varying opinions on how Ethereum ETFs will perform:

Some analysts expect Ethereum ETF flows to be lower than Bitcoin’s but to exceed the average new ETF product’s performance.
Experts predict that Ethereum ETFs could attract significant inflows, with estimates ranging from $4 billion to $45 billion within the first year of launch.

Hot Take: The Future of Ethereum ETFs

As the ETF landscape continues to evolve, it will be interesting to see how Ethereum ETFs perform compared to their Bitcoin counterparts. Keep an eye on the latest developments in this space for potential investment opportunities.

Sources:
1. Fidelity’s S-1 registration form
2. VanEck’s fee comparison