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Ether ETFs from major firms to trade on Cboe, Nasdaq, and

NYSE

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Ether ETFs follow successful launch of bitcoin products in

January

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Galaxy Research projects ether ETFs could attract $1

billion

monthly inflows

By Hannah Lang, Suzanne McGee

July 23 (Reuters) - The first U.S. exchange-traded funds

(ETFs) tied to the price of ether, the world's second-largest

cryptocurrency after bitcoin, are due to begin trading on

Tuesday, in another watershed event for the crypto industry's

push to go mainstream.

Ether ETFs from VanEck, Franklin Templeton,

Fidelity, 21Shares and Invesco ( IVZ ) will begin trading on

Cboe, the exchange said in a Friday notice, while one from

BlackRock ( BLK ) will begin trading on the Nasdaq, according to

an exchange notice. Products from Bitwise and Grayscale

Investments will also trade Tuesday on the New York Stock

Exchange, the exchange said.

Following the launch of nine U.S. spot bitcoin ETFs in January,

the ether products mark another win for the cryptocurrency

industry's campaign to push digital assets into the broader

financial sector, although the products are unlikely to garner

the same volume of inflows, analysts said.

The bitcoin ETF launches were the culmination of a decade-long

tussle with the Securities and Exchange Commission, which had

rejected the products due to market manipulation concerns.

The agency was forced to green-light the ETFs after losing a

court challenge brought by digital asset manager Grayscale

Investments, although it warned when approving them that the

products were still highly risky.

The launch was one of the most successful in the ETF

market's history with the products attracting $33.1 billion in

net inflows as of the end of June, according to Morningstar

Direct data.

Bitcoin ETF issuers competed hard on fees, with many firms

offering to waive fees entirely for a certain period of time.

The ether ETF fees range from a low of 0.19% for Franklin

Templeton's, to a high of 2.5% for Grayscale's existing ethereum

trust, which it is converting into an ETF, according to their

public offering documents. The rest cluster around 0.25%.

Overall, the fees are comparable to the bitcoin products,

although issuers are offering fewer waivers.

Grayscale also is rolling out a "mini" version of both its

ether and bitcoin ETFs with a fee of only 0.15%.

While estimates on demand for the ether products vary

widely, Galaxy Research - whose sister company Galaxy Asset

Management has a pending ether ETF with Invesco ( IVZ ) - has projected

that the ether ETFs could attract monthly inflows of $1 billion.

"Overall, market participants expect strong interest in ETH

Spot ETFs and significant inflows in the first 3-6 months

post-launch," Matteo Greco, research analyst at Fineqia

International, wrote in a note. He added that demand for the

ether ETFs will be crucial in ascertaining investor appetite for

digital assets beyond bitcoin.

Issuers began filing for the ether ETFs in September. Executives

initially had low hopes that the SEC would approve the products

after discouraging meetings with officials.

But the agency surprised the industry in May when it approved

rule changes required for exchanges to list the products, the

first of two key regulatory hurdles.

SEC Chair Gary Gensler last month told Reuters the Grayscale

ruling had influenced his thinking on approving the ether

products, because the underlying market circumstances were

similar.