VanEck Set to Liquidate Its Ethereum Futures ETF

Leading asset manager VanEck has announced it will liquidate its futures Ethereum-based exchange-traded fund (ETF). VanEck stated in a press release on Friday that it would do so following the approval of its Ethereum spot ETF by the United States Securities and Exchange Commission (SEC).

The asset manager gave users until September 16 to withdraw funds from the product—with ticker ETUT—as it would be delisted from the Chicago Board Options Exchange (CBOE) on that date. VanEck noted it would convert unwithdrawn funds to cash equivalents and distribute them to shareowners on September 23.

VanEck to Liquidate ETUF

The $110 billion asset manager’s intended liquidation of the Ethereum Futures ETF came less than a year after it launched the product. ETUF hit the market in October 2023 on the CBOE after gaining regulatory approval. It offered users exposure to Ethereum futures contracts without directly holding them.

VanEck noted that the firm’s Board of Trustees considered certain variables and concluded that the fund should be dissolved.

“As the sponsor of VanEck ETFs, VanEck continuously monitors and evaluates its ETF offerings across a number of factors, including performance, liquidity, assets under management, and investor interest, among others. The decision was made to liquidate the fund based on an analysis of these factors and other operational considerations,” the company stated.

As of September 5, VanEck Ethereum futures ETF had $21.24 million in total net assets and is among the nine issuers offering the product in the US.

Spot ETFs a Likely Cause

In an unlikely turn of events, the US SEC approved VanEck’s spot ETF in May. The Ethereum product made its market debut in late July.

The Ethereum products failed to make a significant market impact as their Bitcoin counterparts did, with the funds seeing a net outflow of $563 million less than two months after their market debut. However, some analysts still expect the ETF to make a comeback and steer an Ethereum supply crunch.

VanEck’s Ethereum spot ETF (ETHV) has seen a cumulative inflow of $63 million since its debut, ranking fifth among the issuers with the highest inflow. The arousal of interest among investors over its spot product and a declining interest in its futures product may be the reason behind the closure.