BlackRock Enters Brazilian Crypto Market with Ether ETF

BlackRock, the world’s largest asset manager, has further expanded its cryptocurrency product offerings by launching an Ethereum exchange-traded fund (ETF) in Brazil. This move comes just months after the successful introduction of its Bitcoin ETF in the country.

The iShares Ethereum Trust (ETHA) is now available for trading on Brazil’s stock exchange, B3, under the ticker ETHA39. This ETF provides investors with exposure to Ethereum, the second-largest cryptocurrency by market capitalization.

The ETHA ETF is structured as a depositary receipt, allowing investors to trade shares representing underlying Ethereum holdings. The ETF will be offered at a price equivalent to one-third of the original share value and will have an annual management fee of 0.25%. For the first year of trading or until the ETF reaches $2.5 billion in assets under management, the fee will be reduced to 0.12%.

BlackRock’s decision to launch the Ethereum ETF in Brazil reflects the growing demand for cryptocurrency-related products in the country. The company’s Bitcoin ETF, launched earlier this year, has experienced significant success, demonstrating strong investor interest in digital assets.

Brazil has been at the forefront of cryptocurrency adoption, with regulators approving various crypto-related products. The recent launch of the Solana-based ETF further solidifies Brazil’s position as a favorable market for digital assets.

Investor Interest and Trading Activity

The growing popularity of crypto products in Brazil is evident in the number of investors and trading activity. According to B3, 180,000 investors hold crypto products worth nearly 5.5 billion Brazilian reais (~$1 billion). Crypto trading volume in the country has also surged, reaching $6 billion in the first five months of 2024, a 30% increase compared to the previous year.

BlackRock’s expansion into the Brazilian crypto market with the launch of its Ethereum ETF highlights the increasing institutional interest in digital assets. As more investors seek exposure to cryptocurrencies, the demand for innovative and accessible products like ETFs is expected to grow.

Brazil’s favorable regulatory environment and growing investor base make it an attractive market for asset managers like BlackRock. The success of BlackRock’s crypto ETFs could further drive the adoption of digital assets in the country and potentially serve as a model for other markets.