BlackRock has just launched its Ethereum ETF on a Brazilian stock exchange, and trading kicks off on Wednesday, August 28. This is exciting news for the Brazilian market, which is increasingly welcoming crypto ETFs. It gives institutional investors better access to digital assets.
The ETF, known in the U.S. as the iShares Ethereum Trust (ETHA), is now available in Brazil under the ticker ETHA39. Brazilian investors can buy it through Brazilian Depositary Receipts (BDRs) on the B3 stock exchange. BDRs are like certificates that represent shares of foreign companies, making ETHA39 a type of ETF BDR.
ETHA39 is priced at one-third of ETHA’s share, trading between R$40 and R$50 (about $7.26 to $9.07). It usually has a management fee of 0.25%. However, for the first year, BlackRock has temporarily lowered this fee to 0.12% on the first $2.5 billion in assets under management.
Recently, ETHA made headlines by becoming the first Ethereum ETF to surpass $1 billion in net inflows. In comparison, its competitors—Fidelity’s FETH, Bitwise’s ETHW, and Grayscale’s ETH—reported net inflows of $367 million, $310 million, and $227 million, respectively.
Currently, BlackRock's Ethereum ETF holds $860 million in net assets. This amount exceeds that of Grayscale’s mini Ethereum trust (ETH) and its Ethereum trust (ETHE). Plus, BlackRock’s Bitcoin fund ranks among the top five ETFs for inflows in 2024, including non-crypto ETFs. This really strengthens BlackRock’s position in the market.
In addition to the Ethereum ETF, BlackRock offers a spot Bitcoin ETF in Brazil, called IBIT39. It launched in March, following a key decision made in January, and it serves as the BDR for BlackRock’s Bitcoin ETF.
As Cristiano Castro, BlackRock’s director in Brazil, stated, “The launch of ETHA39 expands the offering of digital assets and simplifies investors’ access to an asset that has the potential to support a wide and diverse range of blockchain applications.”
While BlackRock is growing its crypto ETF offerings in Brazil, Ethereum ETFs in the U.S. have been facing challenges. Recently, they experienced $3.45 million in net outflows on Tuesday.
Despite these outflows, this development shows Brazil’s commitment to enhancing access to digital assets for its investors. Notably, Brazil is ahead of the U.S. in this area, having introduced the first Solana ETF in early August.
This financial instrument has already started trading on Brazil’s B3 stock exchange. With ETHA39 now available alongside IBIT39 and the QSOL11 Solana ETF, Brazil is positioning itself as a leader in the crypto ETF space.
Meanwhile, the path for Solana ETFs in the U.S. looks challenging. Recent regulatory actions suggest that approval under the current administration is unlikely. As Bloomberg ETF analyst Eric Balchunas put it, “A snowball’s chance in hell of approval unless there’s a change in leadership.” He adds that the chances are near-zero in 2024 and possibly in 2025 as well.