Grayscale Ethereum Trust (ETH) Files 8-K with Material Events

TL;DR

Grayscale Ethereum Trust (ETH) filed an 8-K on 7/22/24 covering material agreements, asset disposition, and financial statements.

AI Summary

On July 22, 2024, Grayscale Ethereum Trust (ETH) filed an 8-K report detailing several material events. These include the entry into and termination of material definitive agreements, and the completion of an acquisition or disposition of assets. The filing also contains financial statements and exhibits related to these events.

Why It Matters

This 8-K filing indicates significant corporate actions and financial reporting for Grayscale Ethereum Trust, which could impact its operational status and investor holdings.

Risk Assessment

Risk Level: medium — The filing involves material definitive agreements and asset disposition, which can carry inherent risks and require careful investor scrutiny.

Key Numbers

• 001-42185 — SEC File Number (Identifies the specific filing with the SEC.)
• 82-6677805 — IRS Employer Identification No. (Tax identification number for the registrant.)

Key Players & Entities

• Grayscale Ethereum Trust (ETH) (company) — Registrant
• July 22, 2024 (date) — Date of earliest event reported
• Delaware (jurisdiction) — State of Incorporation
• Grayscale Investments, LLC (company) — Address of Principal Executive Offices
• 290 Harbor Drive, 4th Floor (address) — Principal Executive Offices
• Stamford, Connecticut (location) — Principal Executive Offices

FAQ

Filing Documents

• ethe-20240722.htm (8-K) — 94KB
• ethe-ex99_1.htm (EX-99.1) — 97KB
• ethe-ex99_2.htm (EX-99.2) — 63KB
• 0000950170-24-086033.txt ( ) — 417KB
• ethe-20240722.xsd (EX-101.SCH) — 28KB
• ethe-20240722_htm.xml (XML) — 5KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. Authorized Participant Agreements Grayscale Investments, LLC, as sponsor (the "Sponsor") on behalf of the Grayscale Ethereum Trust (ETH) (the "Trust"), and the Transfer Agent entered into Participant Agreements with Jane Street Capital, LLC, Virtu Americas LLC, Macquarie Capital (USA) Inc. and ABN AMRO Clearing USA LLC, pursuant to which such entities have agreed to act as Authorized Participants, in each case effective as of July 22, 2024. Each Participant Agreement is substantially in the form filed herewith as Exhibit 10.1. The Trust issues common units of fractional undivided beneficial interest representing ownership in the Trust ("Shares") to, and redeems Shares from, Authorized Participants on an ongoing basis, but only in one or more Baskets (with a "Basket" being a block of 10,000 Shares). The Participant Agreements set forth the procedures for the creation and redemption of Baskets by the Authorized Participants. Although the Trust creates Baskets only upon the receipt of Ether, and redeems Baskets only by distributing Ether or proceeds from the disposition of Ether, at this time an Authorized Participant can only submit "Cash Orders," pursuant to which the Authorized Participant will deposit cash into, or accept cash from, a segregated account maintained by the Transfer Agent in the name of the Trust for purposes of receiving and distributing cash in connection with the creation and redemption of Baskets (such account, the "Cash Account") in connection with the creation and redemption of Baskets. Cash Orders will be facilitated by the Transfer Agent and Grayscale Investments, LLC (in such capacity, the "Liquidity Engager"), which will engage one or more eligible companies (each, a "Liquidity Provider") that is not an agent of, or otherwise acting on behalf of, any Authorized Participant to obtain or receive Ether in connection with such orders. The Sponsor may in its sole discretion limit the num

02 Termination of a Material Definitive Agreement

Item 1.02 Termination of a Material Definitive Agreement. Authorized Participant Agreement In connection with the entry into the Participant Agreements referred to in Item 1.01 hereto, as of July 22, 2024, the Sponsor amended, restated and modified in its entirety the Participant Agreement, dated as of October 3, 2022, between the Sponsor and Grayscale Securities, LLC, a wholly owned subsidiary of the Sponsor and an affiliate and related party of the Trust, to remove the Trust as an entity covered by the Agreement. Distribution and Marketing Agreement Also as of July 22, 2024, the Sponsor amended, restated and modified in its entirety the Distribution and Marketing Agreement, dated as of October 3, 2022, among the Sponsor, the Trust and Grayscale Securities, LLC, a wholly owned subsidiary of the Sponsor and an affiliate and related party of the Trust, to remove the Trust as an entity covered by the Agreement. In its capacity as distributor and marketer, Grayscale Securities assisted the Sponsor in developing an ongoing marketing plan for the Trust, preparing marketing materials regarding the Shares, including the content on the Trust's website, and executing the marketing plan for the Trust.

01 Completion of Acquisition or Disposition of Assets

Item 2.01 Completion of Acquisition or Disposition of Assets. On July 23, 2024, the Trust completed its previously announced pro rata distribution of 310,158,500 shares of Grayscale Ethereum Mini Trust (ETH) (the "ETH Trust") to shareholders of the Trust as of 4:00 PM ET on July 18, 2024 (the "Record Date"), as described in the Trust's definitive information statement on Schedule 14C, filed with the SEC on July 18, 2024 (referred to as the "Initial Distribution"). In connection therewith, after 4:00 PM ET on July 22, 2024, the Trust contributed to the ETH Trust an amount of Ether equal to 10% of the total Ether held by the Trust as of the Record Date, equal to approximately 292,262.98913350 Ether, as consideration and in exchange for the issuance of shares of the ETH Trust.

01 Other Events

Item 8.01 Other Events. Listing on NYSE Arca Shares of the Trust began trading on NYSE Arca on July 23, 2024, under the ticker symbol "ETHE." Shares of the Grayscale Ethereum Mini Trust (ETH) also began trading on NYSE Arca on July 23, 2024, under the ticker symbol "ETH." Commencement of Redemption Program On July 22, 2024, the Sponsor approved the commencement of a redemption program. The redemption procedures through which the Trust will redeem shares in exchange for distributions of Ether are set forth in Item 1.01 hereto. Updates to the description of the Trust's Shares: Creation and Redemption of Shares The Trust creates and redeems Shares at such times and for such periods as determined by the Sponsor, but only in one or more whole Baskets. A Basket equals 10,000 Shares. As of June 30, 2024, each Share represented approximately 0.0094 of one Ether. The creation of a Basket requires the delivery to the Trust of the number of Ether represented by one Share immediately prior to such creation multiplied by 10,000. The redemption of a Basket requires distribution by the Trust of the number of Ether represented by one Share immediately prior to such redemption multiplied by 10,000. The Trust may from time to time halt creations and redemptions for a variety of reasons, including in connection with forks, airdrops and other similar occurrences. The Sponsor does not expect price differentials for Ether across Digital Asset Trading Platforms or the closure of any single Digital Asset Trading Platform to adversely impact the ability of Authorized Participants to implement arbitrage mechanisms, as Ether could be sourced through multiple Digital Asset Trading Platforms. The Sponsor acknowledges, however, that arbitrage mechanisms could be adversely impacted if trading of Ether was delayed or otherwise halted across multiple Digital Asset Trading Platforms, whether due to forces outside the Trust's control or otherwise. Updates to the Trust's disclosure r

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (d) Exhibits Exhibit No. Description 10.1 Form of Participant Agreement (incorporated by reference to Exhibit 4.6 of Amendment No. 1 to the Registration Statement on Form S-3 (File No. 278880) filed with the SEC on May 30, 2024). 99.1 Risk Factors. 99.2 Description of Creation and Redemption of Shares. 104 Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL document)

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Grayscale Investments, LLC, as Sponsor of Grayscale Ethereum Trust (ETH) Date: July 24, 2024 By: /s/ Edward McGee Name: Edward McGee Title: Chief Financial Officer * * The Registrant is a trust and the identified person signing this report is signing in their capacity as an authorized officer of Grayscale Investments, LLC, the Sponsor of the Registrant.

View Full Filing

View this 8-K filing on SEC EDGAR