Franklin Templeton unveils fees, marking the commencement of the Ethereum ETF ‘fee battle’

Franklin Templeton, an American multinational investment firm, has recently filed an amended S-1 application for its proposed exchange-traded fund (ETF) product focused on Ether (ETH). In a filing with the United States Securities and Exchange Commission on May 31, Franklin Templeton disclosed the fees associated with the ETF, making it the first applicant to do so. The sponsor fees, which represent compensation for the fund manager’s administrative expenses, amount to 0.19% of the net asset value of the Fund on a daily basis. Bloomberg ETF analyst Eric Balchunas emphasized the significance of this move, stating that Franklin Templeton has fired the opening shot in the “ETH ETF fee war.” Balchunas dismissed any notion that the disclosed fees might be temporary and suggested that they are likely to remain in place, as they are the same as the fees for Franklin Templeton’s spot Bitcoin ETF product. While other ETF applicants, including VanEck, Invesco, and Galaxy, also submitted amended S-1 applications on the same day, they did not disclose their sponsor fees. The S-1 applications are registration statements required by the SEC, providing detailed information about the company and the securities they plan to offer or issue. Balchunas observed that the absence of fees in the new S-1 filings indicates a temporary pause in the fee war. Prior to the launch of spot Bitcoin ETFs in January, Balchunas referred to the constant amendments to S-1 filings for fee adjustments as the “fee wars.” Some issuers even waived fees entirely to enhance their competitiveness. For example, Bitwise waived all fees for the first six months of trading and the first $1 billion in assets for its spot Bitcoin ETF. In related news, Grayscale Investments and BlackRock also submitted amendments to their filings on May 30 and May 29, respectively. Balchunas viewed these developments as positive signs and predicted that more filings would follow soon. He suggested that spot Ether ETFs could potentially launch by the end of June.