iShares Ethereum Trust ETF

What they do

The Trust owns ether held by Coinbase Custody Trust Company and Anchorage Digital Bank, with Coinbase Inc. as prime execution agent. It issues and redeems shares only in 40,000-share Baskets, exchanging cash or ether via authorized participants and ether trading counterparties. The Trust is not actively managed and does not engage in staking or any profit-seeking activities.

Revenue drivers

• Sponsor's Fee — The Trust's only ordinary expense is the Sponsor's fee, which is paid in ether. The fee is the Trust's sole revenue source, though it is not a profit driver for the Trust itself.
• Ether Price Appreciation — The Trust's performance and net asset value are directly tied to ether's market price, as reflected by the CF Benchmarks Index. Net asset value grew from $3.57 billion to $10.30 billion in 2025 due to price and share issuance.
• Share Issuances — The Trust issues new shares in Baskets in exchange for cash or ether, increasing the asset base. Outstanding shares rose from 141.48 million to 458.72 million during 2025.

Recent performance

For fiscal 2025, the Trust reported a net loss of $2.32 billion versus net income of $34.4 million in 2024, with diluted EPS of -$7.33 compared to $0.74. Operating cash flow was -$8.90 billion in 2025. Net asset value increased to $10.30 billion at year-end 2025 from $3.57 billion at year-end 2024, reflecting significant share growth despite price volatility, including an October 2025 flash crash that saw ether lose about 12.2% in value.

Strategy

The Trust's strategy is to passively reflect ether's price performance before expenses, with no active management or staking. It relies on designated custodians and trading counterparties to facilitate creations and redemptions. The Sponsor assumes most Trust expenses in exchange for the Sponsor's fee, keeping operations simple. No stated forward-looking investment strategy is disclosed beyond maintaining this passive structure.

Risks

• Extreme Ether Price Volatility — Ether has experienced steep price swings, including a 12.2% drop in October 2025, and could lose all or substantially all of its value, directly impacting the Shares.
• Custody and Counterparty Risks — The Trust depends on custodians (Coinbase Custody, Anchorage) and the prime execution agent, and any failure or insolvency could result in loss of ether assets.
• Regulatory and Legal Uncertainty — Changes in laws or regulations concerning digital assets, including taxes, could adversely affect the Trust's operations or the value of the Shares.
• Market Liquidity and Dislocations — The October 2025 flash crash caused liquidations of up to $20 billion in digital asset collateral and service interruptions, highlighting risks of market-wide disruptions.

Outlook

The Trust does not provide forward-looking guidance beyond noting that digital asset prices have continued to fluctuate in 2026. Management cautions that actual results may differ materially due to market volatility and regulatory changes. The Trust expects to continue issuing and redeeming shares passively without engaging in staking or profit-seeking activities.