What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-11-05 compared with 2025-08-01 · 57 added, 37 removed, 122 unchanged (44% of the section changed)

17 unchanged sentences

While an investment in the Shares is not a direct investment in Ether, the Shares are designed to provide investors with a cost-effective and convenient way to gain investment exposure to Ether.

The Trust will not utilize leverage, derivatives or any similar arrangements in seeking to meet its investment objective.

The Trust is not managed like a business corporation or an active investment vehicle.

On January 1, 2025, GSI consummated an internal corporate reorganization (the “Reorganization”), pursuant to which GSI, the Sponsor of the Trust prior to the Reorganization, merged with and into GSO, a Delaware limited liability company and a wholly owned indirect subsidiary of DCG, with GSO continuing as the surviving company (the “Merger”).

The Trust will not utilize leverage, derivatives or any similar arrangements in seeking to meet its investment objective.

On January 1, 2025, GSI consummated an internal corporate reorganization (the “Reorganization”), pursuant to which GSI, the Sponsor of the Trust prior to the Reorganization, merged with and into GSO, a Delaware limited liability company and a consolidated subsidiary of DCG, with GSO continuing as the surviving company (the “Merger”).

As a result of the Merger, GSO succeeded by operation of law to all the rights, powers, privileges and franchises and became subject to all of the obligations, liabilities, restrictions and disabilities of GSI, including with respect to the Sponsor Contracts (as defined below), all as provided under the Delaware Limited Liability Company Act.

39 unchanged sentences

Review of Financial Results (unaudited)

Financial Highlights for the Three and Six Months Ended June 30, 2025

Financial Highlights for the Three and Nine Months Ended September 30, 2025 and the Period from July 23, 2024 (the Commencement of the Trust’s Operations) to September 30, 2024

(All amounts in the following table and the subsequent paragraphs, except Share, per Share, Ether and price of Ether amounts, are in thousands)

Three Months Ended

June 30, 2025

Six Months Ended June 30, 2025

Three Months Ended September 30, 2025

For the Period from July 23, 2024 (the Commencement of the Trust’s Operations) to September 30, 2024

Nine Months Ended September 30, 2025

For the Period from July 23, 2024 (the Commencement of the Trust’s Operations) to September 30, 2024

Net realized and unrealized gain (loss) on investment in Ether

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GAAP based on the Digital Asset Market price of Ether on the Digital Asset Trading Platform that the Trust considered its principal market, as of 4:00 p.m., New York time, on the valuation date.

Net realized and unrealized gain on investment in Ether for the three months ended June 30, 2025 was $328,962, which includes a realized loss of ($188) on the transfer of Ether to pay the Sponsor’s Fee, a realized loss of ($6,067) on the sale of Ether to meet redemptions, and net change in unrealized depreciation on investment in Ether of $335,217.

Net realized and unrealized gain on investment in Ether for the period was driven by Ether price appreciation from $1,827.33 per Ether as of March 31, 2025, to $2,516.23 per Ether as of June 30, 2025.

Net increase in net assets resulting from operations was $328,556 for the three months ended June 30, 2025, which consisted of the net realized and unrealized gain on investment in Ether, less the Sponsor’s Fee of $406.

Net assets increased to $1,330,256 at June 30, 2025, a 59% increase for the three-month period.

The increase in net assets resulted from the aforementioned Ether price appreciation and the contribution of approximately 78,927 Ether with a value of $182,637 to the Trust in connection with Share creations during the period, partially offset by the withdrawal of approximately 183 Ether to pay the foregoing Sponsor’s Fee, and the redemption of approximately 6,499 Ether with a value of $14,976 from the Trust.

Net realized and unrealized loss on investment in Ether for the six months ended June 30, 2025 was ($388,000), which includes a realized loss of ($310) on the transfer of Ether to pay the Sponsor’s Fee, a realized loss of ($41,260) on the sale of Ether to meet redemptions, and net change in unrealized depreciation on investment in Ether of ($346,430).

Net realized and unrealized loss on investment in Ether for the period was driven by Ether price depreciation from $3,340.40 per Ether as of December 31, 2024, to $2,516.23 per Ether as of June 30, 2025.

Net decrease in net assets resulting from operations was ($388,729) for the six months ended June 30, 2025, which consisted of the net realized and unrealized loss on investment in Ether, plus the Sponsor’s Fee of $729.

Net assets decreased to $1,330,256 at June 30, 2025, a 15% decrease for the six-month period.

The decrease in net assets resulted from the aforementioned Ether price depreciation, the withdrawal of approximately 315 Ether to pay the foregoing Sponsor’s Fee, and the redemption of approximately 47,955 Ether, with a value of $119,392 from the Trust, partially offset by the contribution of approximately 106,064 Ether with a value of $265,463 to the Trust in connection with Share creations during the period.

Net realized and unrealized gain on investment in Ether for the three months ended September 30, 2025 was $932,923, which includes a realized gain of $152 on the transfer of Ether to pay the Sponsor’s Fee, a realized gain of $66,728 on the sale of Ether to meet redemptions, and net change in unrealized appreciation on investment in Ether of $866,043.

Net realized and unrealized gain on investment in Ether for the period was driven by Ether price appreciation from $2,516.23 per Ether as of June 30, 2025, to $4,161.61 per Ether as of September 30, 2025.

Net increase in net assets resulting from operations was $931,931 for the three months ended September 30, 2025, which consisted of the net realized and unrealized gain on investment in Ether, less the Sponsor’s Fee of $992.

Net assets increased to $3,001,975 at September 30, 2025, a 126% increase for the three-month period.

The increase in net assets resulted from the aforementioned Ether price appreciation and the contribution of approximately 285,004 Ether with a value of $1,115,426 to the Trust in connection with Share creations during the period, partially offset by the redemption of approximately 92,076 Ether with a value of $375,638 from the Trust, and the withdrawal of approximately 249 Ether to pay the foregoing Sponsor’s Fee.

Net realized and unrealized loss on investment in Ether for the period from July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2024 was ($289,749), which includes a realized loss of ($3,536) on the sale of Ether to meet redemptions and net change in unrealized depreciation on investment in Ether of ($286,213).

Net realized and unrealized loss on investment in Ether for the period was driven by Ether price depreciation from $3,458.99 per Ether as of July 23, 2024 (the commencement of the Trust’s operations), to $2,594.43 per Ether as of September 30, 2024.

Net decrease in net assets resulting from operations was ($289,749) for the period from July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2024, which consisted of the net realized and unrealized loss on investment in Ether.

Net assets increased to $1,015,027 at September 30, 2024.

The increase in net assets resulted from the contribution of approximately 105,001 Ether with a value of $310,876 to the Trust in connection with Share creations during the period and the contribution of approximately 292,263 Ether with a value of $1,010,935 to the Trust in connection with the Initial Distribution from Grayscale Ethereum Trust ETF, partially offset by the aforementioned Ether price depreciation and the redemption of approximately 6,031 Ether, with a value of $17,035 from the Trust.

Net realized and unrealized gain on investment in Ether for the nine months ended September 30, 2025 was $544,923, which includes a realized loss of ($158) on the transfer of Ether to pay the Sponsor’s Fee, a realized gain of $25,468 on the sale of Ether to meet redemptions, and net change in unrealized appreciation on investment in Ether of $519,613.

Net realized and unrealized gain on investment in Ether for the period was driven by Ether price appreciation from $3,340.40 per Ether as of December 31, 2024, to $4,161.61 per Ether as of September 30, 2025.

Net increase in net assets resulting from operations was $543,202 for the nine months ended September 30, 2025, which consisted of the net realized and unrealized gain on investment in Ether, less the Sponsor’s Fee of $1,721.

Net assets increased to $3,001,975 at September 30, 2025, a 91% increase for the nine-month period.

The increase in net assets resulted from the aforementioned Ether price appreciation and the contribution of approximately 391,068 Ether with a value of $1,380,889 to the Trust in connection with Share creations during the period, partially offset by the redemption of approximately 140,031 Ether, with a value of$495,030 from the Trust and the withdrawal of approximately 564 Ether to pay the foregoing Sponsor’s Fee.

Cash Resources and Liquidity

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Following the expiration date of the six-month waiver period on January 23, 2025 (the “Sponsor’s Fee Waiver Expiration Date”), the Sponsor’s Fee is 0.15%.

For the period from the Sponsor’s Fee Waiver Expiration Date through June 30, 2025, the Trust incurred Sponsor’s Fees of $727,181.

For the period from the Sponsor’s Fee Waiver Expiration Date through September 30, 2025, the Trust incurred Sponsor’s Fees of $1,720,471.

The Trust is not aware of any trends, demands, conditions or events that are reasonably likely to result in material changes to its liquidity needs.

Selected Operating Data

Three Months Ended

June 30, 2025

Six Months Ended June 30, 2025

Three Months Ended September 30, 2025

For the Period from July 23, 2024 (the Commencement of the Trust’s Operations) to September 30, 2024

Nine Months Ended September 30, 2025

For the Period from July 23, 2024 (the Commencement of the Trust’s Operations) to September 30, 2024

(All Ether balances are rounded to the nearest whole Ether)

Opening balance

Creation from Initial Distribution (1)

Sponsor’s Fee, related party

4 unchanged sentences

Opening balance

Creation from Initial Distribution (1)

Closing balance

As of June 30, 2025

As of September 30,

Price of Ether on principal market (3)

2 unchanged sentences

NAV per Share (2)(5)

(1) The Trust performed an assessment of the principal market at June 30, 2025, and identified the principal market as Crypto.com.

(2) As of June 30, 2025, the Principal Market NAV per Share was calculated using the fair value of Ether based on the price provided by Crypto.com, the Digital Asset Trading Platform that the Trust considered its principal market, as of 4:00 p.m., New York time, on the valuation date.

(1) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $1,010.9 million from Grayscale Ethereum Trust ETF, completed on July 23, 2024, as discussed in Note 4 of the notes to the financial statements.

(2) Share and per Share amounts have been retroactively adjusted to reflect the 1-for-10 Reverse Share Split of the Trust’s issued and outstanding Shares completed on November 19, 2024.

(3) The Trust performed an assessment of the principal market at September 30, 2025, and identified the principal market as Crypto.com.

The Trust performed an assessment of the principal market at September 30, 2024 and identified the principal market as Coinbase.

(4) As of September 30, 2025, the Principal Market NAV per Share was calculated using the fair value of Ether based on the price provided by Crypto.com, the Digital Asset Trading Platform that the Trust considered its principal market, as of 4:00 p.m., New York time, on the valuation date.

As of September 30, 2024, the Principal Market NAV per Share was calculated using the fair value of Ether based on the price provided by Coinbase, the Digital Asset Trading Platform that the Trust considered its principal market, as of 4:00 p.m., New York time, on the valuation date.

(5) The Trust’s NAV per Share is derived from the Index Price as represented by the Index as of 4:00 p.m., New York time, on the valuation date.

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Business—Overview of the Ethereum Industry and Market—Ether Value—The Index and the Index Price” in our Annual Report for a description of the Index and the Index Price.

On June 22, 2025, the Index Provider added LMAX Digital to the Index due to the trading platform meeting the Index Provider’s minimum liquidity requirement, and did not remove any Constituent Trading Platforms as part of its scheduled quarterly review.

The Digital Asset Trading Platforms included in the Index (the “Constituent Trading Platforms”) as of June 30, 2025 were Coinbase, Kraken, Bullish, Crypto.com, and LMAX Digital.

On September 21, 2025, the Index Provider added Gemini to the Index due to the trading platform meeting the Index Provider’s minimum liquidity requirement, and removed Bullish due to the trading platform failing to meet the Index Provider’s minimum liquidity requirement, as part of its scheduled quarterly review.

The Digital Asset Trading Platforms included in the Index (the “Constituent Trading Platforms”) as of September 30, 2025, were Coinbase, Kraken, Crypto.com, LMAX Digital, and Gemini.

The Digital Asset Trading Platforms included in the Index as of September 30, 2024, were Coinbase, Kraken, LMAX Digital and Crypto.com.

Business—Valuation of Ether and Determination of NAV” in our Annual Report for a description of the Trust’s NAV per Share.

1 unchanged sentence

Creation and redemption orders are settled on T+1 or T+2, as established at the time of order placement, and therefore the Ether for proceeds receivable or payable with respect to such creations and redemptions, respectively, are recorded as a receivable or payable until the Ether are delivered or removed from the Trust for settlement.

As of June 30, 2025, the Trust had a net closing balance of 528,670.39510393 Ether with a value of $1,331,223,775, based on the Index Price of $2,518.06 on June 30, 2025 (non-GAAP methodology).

As of June 30, 2025, the total market value of the Trust’s Ether was $1,330,256,308, based on the price of one Ether in the principal market (Crypto.com) of $2,516.23 on June 30, 2025.

As of September 30, 2025, the Trust had a net closing balance of 721,349.34169850 Ether with a value of $3,002,234,320, based on the Index Price of $4,161.97 on September 30, 2025 (non-GAAP methodology).

As of September 30, 2025, the total market value of the Trust’s Ether was $3,001,974,634, based on the price of one Ether in the principal market (Crypto.com) of $4,161.61 on September 30, 2025.

As of September 30, 2024, the Trust had a net closing balance of 391,232.97302030 Ether with a value of $1,014,361,466, based on the Index Price of $2,592.73 on September 30, 2024 (non-GAAP methodology).

As of September 30, 2024, the total market value of the Trust’s Ether was $1,015,026,562, based on the price of one Ether in the principal market (Coinbase) of $2,594.43 on September 30, 2024.

Historical NAV and Ether Prices

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Movements may be influenced by various factors, including, but not limited to, government regulation, security breaches experienced by service providers, as well as political and economic uncertainties around the world.

The following chart illustrates the movement in the Trust’s NAV per Share (as adjusted for the Reverse Share Split for periods prior to November 20, 2024) versus the Index Price and the Trust’s Principal Market NAV per Share (as adjusted for the Reverse Share Split for periods prior to November 20, 2024) from July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025.

For more information on the determination of the Trust’s NAV, see “Item 1.

Business—Overview of the Ethereum Industry and Market—Ether Value—The Index and the Index Price” in our Annual Report.

The following table illustrates the movements in the Index Price from July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025.

During such period, the Index Price has ranged from $1,465.07 to $4,050.21, with the straight average being $2,652.88 through June 30, 2025.

The Sponsor has not observed a material difference between the Index Price and average prices from the Constituent Trading Platforms as of June 30, 2025, individually or as a group.

The following table illustrates the movements in the Index Price from July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2025.

During such period, the Index Price has ranged from $1,465.07 to $4,832.59, with the straight average being $2,922.05 through September 30, 2025.

The Sponsor has not observed a material difference between the Index Price and average prices from the Constituent Trading Platforms as of September 30, 2025, individually or as a group.

End of period

Last business day

July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025

The following table illustrates the movements in the Digital Asset Market price of Ether, as reported on the Trust’s principal market, from July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025.

During such period, the price of Ether has ranged from $1,465.40 to $4,053.28, with the straight average being $2,652.82 through June 30, 2025.

July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2024

Twelve months ended September 30, 2025

July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2025

During such period, the price of Ether has ranged from $1,465.40 to $4,833.89, with the straight average being $2,922.05 through September 30, 2025.

Digital Asset Market Price

2 unchanged sentences

Last business day

July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025

The following chart sets out the historical closing prices for the Shares as reported by NYSE Arca from July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025 and the Trust’s NAV per Share from July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025.

July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2024

Twelve months ended September 30, 2025

July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2025

The following chart sets out the historical closing prices for the Shares as reported by NYSE Arca from July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2025 and the Trust’s NAV per Share from July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2025.

ETH Premium/(Discount):

1 unchanged sentence

NAV per Share (Non-GAAP) ($)

The following chart sets out the historical premium and discount for the Shares calculated as a percentage of the historical closing prices for the Shares as reported by NYSE Arca from July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025 divided by the Trust’s NAV per Share from July 23, 2024 (the commencement of the Trust’s operations) to June 30, 2025.

The following chart sets out the historical premium and discount for the Shares calculated as a percentage of the historical closing prices for the Shares as reported by NYSE Arca from July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2025 divided by the Trust’s NAV per Share from July 23, 2024 (the commencement of the Trust’s operations) to September 30, 2025.

ETH Premium/(Discount):

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis