Ethereum ETF: BlackRock Receives $10 Million Seed Investment, Grayscale Adds Coinbase Custody.

Both BlackRock and Grayscale have updated their U.S. spot Ethereum Exchange Traded Fund (ETF) filings to add seed investors and establish a custodian.

BlackRock, the world’s largest fund manager, has received $10 million in capital from seed investors who bought shares of the soon-to-launch iShares Ethereum Trust, according to a filing. A Form S-1 filed with the SEC late Wednesday states that the seed investor purchased 400,000 shares at $25 and will act as a “statutory underwriter.”

Seed capital investors initially fund ETFs to launch them and trade them on stock exchanges.

This marks a significant shift in attitudes toward the investment product following the SEC’s approval of a spot Ethereum ETF last week. Just a week ago, experts seemed to be dismissing the possibility of an ETH ETF in the US. But the SEC quickly changed its mind after the fund issuer removed language about staking.

BlackRock is one of nine investment firms that have applied to offer a spot Ethereum ETF. However, they are all still waiting to finalize the paperwork and receive final approval for the deal to begin.

One of the other companies is Grayscale, the manager of the largest Bitcoin spot ETF, which recently established centralized exchange Coinbase as its fund administrator, the company said in a filing Wednesday.

ETFs, or exchange-traded funds, allow investors to purchase stocks that track the price of an underlying asset such as gold, foreign currency, or cryptocurrency. Like the Spot Bitcoin ETF, this Spot Ethereum ETF holds Ethereum and provides investors with exposure to the digital asset.

Coinbase manages 90% of total assets stored in U.S. spot Bitcoin ETFs. With this new Grayscale filing, it has officially secured the same role as one of the largest spot Ethereum ETFs.

Experts have expressed concerns about centralization after the SEC approved a spot Ethereum ETF. Coinbase is already the second-largest Ethereum validator and will become the custodian of at least six of the nine companies planning to launch Ethereum ETFs. As a result, experts have warned that this centralization risk could pose a “serious security risk.”

Edited by Stacy Elliott.