3 ETFs holding ether will start trading. What you need to know.

Text size

While the US market expects its first traded fund in exchange for Bitcoin, Canada, which has already approved a few Bitcoin ETFs, moved on to the next.

Last week, the Ontario Securities Commission approved the launch of three ETFs that would offer investors direct exposure to Ether, the second market-capitalized cryptocurrency after Bitcoin. On Tuesday, three Ether-based funds are expected to be listed on the Toronto Stock Exchange: Purpose Investments Purpose Ether ETF (ticker: ETHH), CI Global Asset Management CI Galaxy Ethereum ETF (ETHX) and Evolve Ether ETF (ETHR).

The approvals come two months after Canada approved its first Bitcoin ETF, the

Bitcoin ETF purpose

(BTCC). This ETF has already accumulated $ 1.4 billion ($ 1.1 billion) since its launch, demonstrating the strong demand from investors for a way to keep cryptocurrencies without the hassle of securing and storing them, as well as the ability to integrate the class of emerging assets into portfolios and negotiate at lower costs.

“While bitcoin tends to draw a lot of attention, as it was the first major cryptocurrency, what Ether and the Ethereum ecosystem represent is one of society’s most exciting technological visions today,” said Som Seif , founder and CEO of Purpose Investments. in a statement.

But for a space as competitive (and some might say, homogeneous) as cryptocurrency funds, cost is one of the most important factors.

Days after the approval of Purpose Bitcoin ETF in February, which charges a management fee of 1%, rival

Evolves Bitcoin ETF

(EBIT) followed the same and reduced its management fee to 0.75%. He

CI Galaxy Bitcoin ETF

(BTCX), which hit the market in early March, charges 0.40% even lower. 3iQ has entered the game this week, releasing the

3iQ CoinShares Bitcoin ETF

(BTCQ) Monday with a management fee of 1%.

Management fees are not the only thing investors will have to pay. A fund may also have additional charges that cover day-to-day operations, taxes and other expenses. The Purpose Bitcoin ETF promised that its total cost, or management expense ratio, would not exceed 1.50%. The 3iQ fund said it would waive any spending in excess of 1.25%. The Evolve and CI Galaxy Bitcoin ETFs did not specify any such limit in their brochure.

If Bitcoin’s strong ETF demand is any indication, Ether’s upcoming ETFs are likely to see a wave of cash inflows. Unlike Bitcoin ETFs, where the first approved had a significant advantage in the first move, all three Ether ETFs will be launched at the same time and will start trading on fair playing terms.

Similar to its Bitcoin counterparts, the Purpose Ether ETF will charge a 1% management fee. The Evolve version will cost 0.75% and the Galaxy Ethereum CI ETF will charge 0.40%. But a price war has already begun: to attract new investors, Evolve announced over the weekend that it will step down from full management until May 31, making its ETher ETF essentially free. The management fee will return to 0.75% after May 31, the company said, plus applicable sales taxes.

Ether concentrated last year, along with Bitcoin, amid the craze for cryptocurrencies. It has fallen 8% since last Thursday after the public cryptocurrency exchange list

Coinbase

Global (COIN).

Write to Evie Liu at [email protected]