Franklin Templeton Ethereum ETF Starts ‘Payment War’ Position
American multinational investment firm Franklin Templeton has filed an amended S-1 filing for its proposed Ethereum (ETH) exchange-traded fund (ETF) product, and it is the first of the filings to disclose fees to investors.
“The sponsor's fees accrue daily at an annual rate equal to 0.19% of net asset value,” Franklin Templeton said in a May 31 filing with the United States Securities and Exchange Commission.
“The opening shot in the ETH ETF fee war was fired from Franklin,” Bloomberg ETF analyst Eric Balchunas said in an X-Post the same day. He shut down questions if it could be “only for some startups” and “seems permanent” the same fee as the Franklin Place Bitcoin ETF product.
Sponsor fees – fees to compensate the fund manager for management costs – are a competitive aspect of ETF products, as investors often prefer lower fees.
While VanEck, Invesco and Galaxy filed amended S-1 filings simultaneously on the same day, none disclosed sponsor fees. These filings are registration statements that companies file with the SEC, including details about the company and the securities they intend to offer or issue.
“There are also no fees in any new S-1. The fee war has stopped for now,” Balchunas added.
Prior to the launch of Bitcoin ETFs in January, Balchunas was referring to permanent S-1 filings for fee adjustments as “fee wars.”
Many issuers have even gone so far as to waive fees altogether in order to be more competitive. Bitwise has waived all fees for the first six months of trading and the first $1 billion in assets of the Bitcoin ETF.
Related: Ethereum ETF Launches ‘Legal Chance' in June as BlackRock Files S-1
Grayscale Investments and BlackRock filed updates on May 30 and May 29, respectively. “A good sign,” Bloomberg ETF analyst Eric Balchunas commented at the time. Maybe check out a vacation soon.
He hinted at the possibility of another round of “corrections” to the SEC comments, but said a launch of the Ether ETF by the end of June is a “legitimate possibility.”
Magazine: Crypto voters are rocking the 2024 election — and it's set to continue.
