Global investment management firm VanEck has made the decision to close and liquidate its Ethereum ETH/USD futures ETF (EFUT). The board of trustees for VanEck ETF Trust has approved the dissolution of the VanEck Ethereum Strategy ETF (EFUT) on the CBOE exchange. This decision follows a comprehensive evaluation of various factors, including performance, liquidity, assets under management, investor interest, and operational considerations.
Shareholders have the option to sell their shares on the Fund’s listing exchange until the market closes on September 16, 2024. After this date, the Fund’s shares will be delisted and will no longer trade on the listing exchange. Shareholders who retain their shares on the liquidation date, expected to be around September 23, 2024, will receive a cash distribution in their brokerage accounts equivalent to the net asset value of their shares. The liquidation proceeds are planned to be disbursed to shareholders around September 23, 2024.
For tax purposes, shareholders will generally recognize a capital gain or loss equal to the amount received for their shares over their adjusted basis in those shares. Shareholders will also receive a final distribution of net income and capital gains earned by the Fund that were not previously distributed before liquidation.
This closure and liquidation of the Ethereum futures ETF by VanEck is a significant event in the investment landscape. The decision could potentially impact the dynamics of the cryptocurrency market and the ETF industry. It also sheds light on the factors that investment management firms consider when deciding to liquidate such funds.
According to SoSoValue data, the U.S. Ethereum Spot ETF experienced a daily total net flow decrease of $152,000 and a cumulative total net inflow plunge of $562.3 million as of September 5th. The total value traded stood at $108.6 million.
This event raises questions about the future of Ethereum ETFs and the broader cryptocurrency investment landscape. The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on November 19th.
