Franklin Templeton Leads in ETH ETF Fee Disclosure, Fires First in Fee War
Summary:
Franklin Templeton, an international investment firm, has filed an S-1 application for its proposed Ether (ETH) exchange-traded fund (ETF), being the first to disclose its sponsor fees. The company has said the sponsor's fee will accrue at a rate of 0.19% of the fund's net asset value, annually. This move, referred to as the start of the ETH ETF fee war, is seen as permanent and mirrors the fee for Franklin's Bitcoin ETF. Other firms have also submitted S-1 applications but didn't disclose their fees.
Franklin Templeton, a global investment corporation, recently updated its S-1 application for a planned Ether (ETH) spot exchange-traded fund (ETF), making it the first in line to share the investment charges. According to the May 31 filing with the US Securities and Exchange Commission, the Fund's net asset value garners the Sponsor's fees at a daily rate that equates to 0.19% per year. In a post published on the same day, Eric Balchunas, Bloomberg ETF Analyst, revealed this as the initial move in the ETH ETF fee battle, initiated by Franklin. With the assurance that it's a lasting move, he addressed any speculation of it being a temporary measure, mentioning that it matches Franklin's spot Bitcoin ETF product's fee rates.
Every ETF has Sponsor's fees, serving as the fund manager's compensation for administrative expenses. These fees are competitive elements, with investors frequently opting for the ETF with the least charges. While other firms like VanEck, Invesco, and Galaxy all revised and submitted S-1 applications on the identical day, none of them revealed their Sponsor's fee details. S-1 applications are registration declarations mandatory for firms to submit to the SEC. The documents entail comprehensive data about the organization and the securities they plan to propose or dispense.
Balchunas added that none of the new S-1s disclosed the fees. Before the launching of spot Bitcoin ETFs in January, he referred to the successive S-1 filing adjustments for fee changes as "fee wars." Several issuers went to the extent of relinquishing all charges in a competitive bid. For instance, Bitwise abandoned all fees on its Bitcoin ETF in the premier six months of trading and for the initial $1 billion in assets.
Grayscale Investments and BlackRock made amendment submissions on May 29-30. At that time, Balchunas referred to this as a "Good sign," asserting the likelihood of further submissions. He also pointed out the probability of another round to fine-tune SEC comments. According to him, the launching of a spot Ether ETF by the end of June seems plausible.
Published At
6/1/2024 7:04:47 AM
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