3 ETFs holding Ether will start trading. What to know.

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While the US market awaits its first Bitcoin-traded fund, Canada – which has already approved several Bitcoin ETFs – has moved on.

Last week, the Ontario Securities Commission approved the launch of three ETFs that would give investors direct exposure to Ether, the second largest cryptocurrency by market capitalization after Bitcoin. On Tuesday, three funds holding Ether will begin trading on the Toronto Stock Exchange: Purpose Ether Purpose Investments (ticker: ETHH) ETF, 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,

Bitcoin ETF purpose

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

“While bitcoin tends to get a lot of attention because it was the first major cryptocurrency, representing the ether and the Ethereum ecosystem is one of the most exciting visions of today’s new technology in society,” 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 the Purpose Bitcoin ETF in February, it charges an administration fee of 1%, rival

Evolves Bitcoin ETF

(EBIT) followed suit and reduced its management fee to 0.75%.

CI Galaxy Bitcoin ETF

(BTCX), which came on the market in early March, charges even less than 0.40%. 3iQ came into play this week, launching

3iQ CoinShares Bitcoin ETF

(BTCQ) Monday with an administration fee of 1%.

Administration fees are not the only thing investors have to pay. A fund may also have additional fees that cover day-to-day operations, taxes and other expenses. The Purpose Bitcoin ETF has promised that its total cost or management expense ratio will not exceed 1.50%. The 3iQ fund stated that it will waive any expenses over 1.25%. Evolve and CI Galaxy Bitcoin ETFs did not specify such caps in their prospectus.

If the strong demand for Bitcoin ETFs is a clue, the Ether ETFs that follow are likely to see a lot of cash inflows. Unlike Bitcoin ETFs, where the first approved had a significant advantage for the first move, all three Ether ETFs will be launched at the same time and will start trading on equal ground.

Similar to Bitcoin counterparts, the Purpose Ether ETF will charge a 1% administration 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 waive the full administration fee by May 31, making the Ether ETF essentially free. The administration fee will return to 0.75% after May 31, the company said, plus applicable sales taxes.

Ether has gathered in the last year, along with Bitcoin, amid the craze of cryptocurrencies. It fell 8% on Thursday after the public listing of the cryptocurrency exchange

Coinbase

Global (CURRENCY).

Write to Evie Liu at [email protected]