Crypto asset manager Grayscale has transferred a substantial $1.01 billion worth of Ethereum (ETH) to Coinbase Prime ahead of the debut of Ethereum exchange-traded funds (ETFs).
Crypto asset manager Grayscale has transferred a substantial $1.01 billion worth of Ethereum (ETH) to Coinbase Prime ahead of the debut of Ethereum exchange-traded funds (ETFs) in the U.S. this week. The sizable transaction on Wednesday has led market participants to speculate that Grayscale might be planning a sell-off to reinvest in other cryptocurrencies, such as Solana.
However, Jon Campagna, managing partner at the crypto hedge fund Nexyst Digital and a former executive at Coinfund and Blackrock, dismissed these claims. Campagna stated on X that Grayscale is unlikely to shift its Ethereum holdings. He further explained that this move comes as Grayscale transferred 10% of its Grayscale Ethereum Trust (ETHE) holdings into its separate Ethereum ETF (ETH) on July 18. The new fund is set to become active on Wednesday, with ETHE holders receiving proportional ETF positions.
To facilitate this transition, Grayscale moved $1 billion, representing 10% of their $10 billion assets under management (AUM) in ETHE, to Coinbase Prime. This transfer had been announced a week earlier by Grayscale.
"What will be interesting is to see the outflows from ETHE as they refuse to lower their fee," Campagna noted. "My guess is those outflows get recycled into inflows into the lower-cost ETFs, like Grayscale's own 15 basis point fee ETH ticker. Brilliant move by them as they quasi-guarantee more assets stay in-house this way."
Eric Balchunas, an ETF analyst at Bloomberg, echoed this sentiment in a July 18 post on X, pointing out that Grayscale is maintaining a 2.5% fee on ETHE. "Grayscale is not lowering at all," Balchunas wrote, "This means they are ten times higher than competition."
This article contains links to third-party websites or other content for information purposes only (“Third-Party Sites”). The Third-Party Sites are not under the control of CoinMarketCap, and CoinMarketCap is not responsible for the content of any Third-Party Site, including without limitation any link contained in a Third-Party Site, or any changes or updates to a Third-Party Site. CoinMarketCap is providing these links to you only as a convenience, and the inclusion of any link does not imply endorsement, approval or recommendation by CoinMarketCap of the site or any association with its operators.
This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice.
The views and opinions expressed in this article are the author’s [company’s] own and do not necessarily reflect those of CoinMarketCap.
