Grayscale Ethereum Staking ETF (NYSE: ETHE)

Grayscale Ethereum Staking ETF is a Delaware statutory trust that was formed to hold Ethereum tokens (Ether) and to issue shares that represent fractional undivided beneficial interest in the trust. The trust acquires Ether through deposits from authorized participants and holds the tokens in custody. It also receives staking rewards when the staking condition is satisfied, which increases the amount of Ether held. Each share corresponds to a specific amount of Ether, and the trust issues and redeems shares only in blocks of ten thousand known as baskets. The shares are listed on NYSE Arca under the ticker symbol ETHE and are intended to give investors exposure to the price of Ether plus any staking income after deduction of the trust’s expenses. The trust’s investment objective is for the value of its shares to reflect the value of the Ether it holds, including any staking income, less expenses.

The trust does not run an active business that sells goods or services for revenue. Its economic value comes from the Ether it holds and any staking rewards that accrue to those holdings. The sponsor receives a fee equal to 2.5% of the trust’s net asset value, paid in Ether each day, which compensates the sponsor for services such as administration, custody, marketing and other operational costs. Any additional trust expenses, such as legal, audit or regulatory fees, are also covered by selling or delivering Ether. The trust’s net asset value reflects the value of its Ether holdings less the sponsor’s fee and other expenses, and this value is used to calculate the net asset value per share that is published daily. Staking rewards that are earned are added to the trust’s Ether holdings and may be distributed to shareholders in accordance with the sponsor’s staking policy, which is posted on the trust’s website.

Within the digital asset investment space, Grayscale Ethereum Staking ETF competes with other ether focused exchange traded products and trusts, such as competing crypto trusts offered by CoinShares and various bitcoin and multi asset funds. The trust holds approximately 0.8% of all Ether in circulation as of December 31, 2025, giving it a notable presence in the market. Its competitive advantages include direct ownership of actual Ether stored in cold security custody with Coinbase Custody Trust Company, a transparent daily net asset value published on its website, and a low cost structure that avoids leverage, derivatives, or active management. The trust does not seek to influence the Ethereum network and its holdings represent a passive stake that mirrors the price of Ether plus any staking income. Unlike actively managed funds, the trust follows a simple rule of holding Ether and distributing staking rewards after deducting the sponsor’s fee, which makes it easy for investors to understand what they own.

The trust’s shares are bought and sold by a wide range of investors, including retail individuals and institutional investors who trade through brokerage accounts. Authorized participants that create and redeem baskets of shares include Jane Street Capital, LLC, Virtu Americas LLC, Macquarie Capital (USA) Inc., ABN AMRO Clearing USA LLC, and Goldman Sachs & Co. LLC. These firms deliver Ether or cash to the trust in exchange for newly issued shares or surrender shares for redemption, thereby linking the trust to the broader cryptocurrency market. In addition, the trust provides daily net asset value information on its website, which is accessible to all market participants.