Cryptocurrency

Blackrock updates S-1 filing for Ethereum ETF, marking step toward launch

BlackRock amended the S-1 registration statement for its spot Ethereum ETF in a May 29 filing, marking a step toward approval.

The filing builds on BlackRock’s original registration statement, which was initially filed in November 2023.

Bloomberg ETF analyst James Seyffart called the filing a step toward launch after the SEC approved 19b-4 listing rule changes on May 23.

He said:

 “This is almost certainly the engagement we were looking for …”

Seyffart reaffirmed his belief that the S-1 statements could gain approval in the coming weeks, leading to spot Ethereum ETF launches, but admitted that the “norm is months.”

Placeholder data filled

The S-1 filing fills several placeholder fields, including details about seed funding.

According to the filing, the fund has generated $10 million in proceeds via a seed capital purchase by BlackRock Financial Management of 400,000 shares at $25 per share.

The sponsor, iShares Delaware Trust Sponsor, may collect up to $500,000 in fees per annum. The latest filing does not calculate a percentage-based sponsor fee.

The trust will issue and redeem shares only in blocks of 40,000. The fund’s ticker is ETHA.

Wilmington Trust, National Association will act as the Delaware trustee. Bank of New York Mellon will act as trust administrator and cash custodian.

In-kind redemptions considered

The new S-1 also reintroduces the possibility of in-kind creation and redemptions, which would allow for crypto rather than cash transactions among authorized participants.

It acknowledges that approval of in-kind transactions is not guaranteed and that timing is uncertain.

BlackRock’s original S-1 statement mentioned the possibility of in-kind creations and redemptions in passing. However, an amendment notice to Nasdaq’s 19b-4 filing in April said that authorized participants would rely solely on cash when creating and redeeming shares in the fund.

The latest S-1 also explicitly states that BlackRock will not engage in ETH staking, aligning with Nasdaq’s second May 22 19b-4 amendment on behalf of BlackRock.

All other ETH ETF issuers have also removed the possibility of staking from their applications.

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