Grayscale Ethereum Staking ETF 10-K

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read together with, and is qualified in its entirety by reference to, our audited financial statements and related notes included elsewhere in this Annual Report, which have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The following discussion may contain forward-looking statements based on assumptions we believe to be reasonable. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed below and elsewhere in this Annual Report, particularly in “Item 1A. Risk Factors” and “Forward-Looking Statements.” Trust Overview The Trust is a passive entity that is managed and administered by the Sponsor and does not have any officers, directors or employees. The Trust holds Ether and, from time to time on a periodic basis, issues Creation Baskets in exchange for deposits of Ether. On July 22, 2024, in connection with the approval of application under Rule 19b-4 of the Securities Exchange Act of 1934 on May 23, 2024 and the effectiveness of the registration statement on Form S-3, as amended (File No. 333-278880), the Sponsor authorized the commencement of a redemption program. Shares of the Trust began trading on NYSE Arca on July 23, 2024, following the effectiveness of the Trust’s registration statement on Form S-3, as amended. The Trust issues Shares only in one or more blocks of 10,000 Shares (a block of 10,000 Shares is called a “Basket”) to certain Authorized Participants from time to time. Baskets are offered in exchange for Ether. Through its redemption program, the Trust redeems Shares from Authorized Participants on an ongoing basis. As a passive investment vehicle, the Trust’s investment objective is for the value of the Shares (based on Ether per Share) to reflect the value of Ether held by the Trust, determined by reference to the Index Price, less the Trust’s expenses and other liabilities. 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. Historically, the Trust has not met its investment objective and, prior to their uplisting to NYSE Arca on July 23, 2024, the Shares quoted on OTCQX did not reflect the value of Ether held by the Trust, less the Trust’s expenses and other liabilities, but instead traded at both premiums and discounts to such value, which at times were substantial, although the Sponsor has observed that the Trust has begun to meet its investment objective more closely following the uplisting of the Shares to NYSE Arca. The Trust is not managed like a business corporation or an active investment vehicle. As of December 31, 2024 2023 2022 Number of Shares authorized Unlimited Unlimited Unlimited Number of Shares outstanding 169,098,500 310,158,500 310,158,500 Number of Shares freely tradable (1) 169,083,382 305,275,122 304,828,878 Number of beneficial holders owning at least 100 Shares (2) 19 23 28 Number of holders of record (2) 21 25 29 (1) Includes the total number of Shares that are not restricted securities as such term is defined under Rule 144. (2) Includes Cede & Co. as nominee for DTC for the Shares traded on NYSE Arca, on or after July 23, 2024, or on OTCQX, prior to July 23, 2024, as applicable, but not its direct participants. Therefore, this number does not include the individual holders who have bought/sold Shares on NYSE Arca, on or after July 23, 2024, or on OTCQX, prior to July 23, 2024, as applicable, or transferred their eligible Shares to their brokerage accounts. 95 The ETH Trust Distribution On July 23, 2024, the Trust completed its previously announced pro rata distribution of 310,158,500 shares of Grayscale Ethereum Mini Trust ETF (the “ETH Trust”) to shareholders of the Trust as of 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, on July 23, 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 292,262.98913350 Ether, as consideration and in exchange for the issuance of shares of the ETH Trust. Subject to the limitations and qualifications set forth in the Trust’s definitive information statement on Schedule 14C, filed with the SEC on July 18, 2024 (including with respect to the qualification of both the Trust and the ETH Trust as grantor trusts for U.S. federal income tax purposes and the proper allocation of existing tax basis between Shares of the Trust and shares of the ETH Trust), it is expected that neither the Trust nor any beneficial owner of the Shares will recognize any gain or loss for U.S. federal income tax purposes as a result of the Initial Distribution. Accordingly, it is expected that neither the Trust’s contribution of Ether to the ETH Trust nor the Trust’s distribution of shares in the ETH Trust to shareholders as of 4:00 PM ET on the Record Date will be reported to any beneficial owner of Shares (or to any intermediary holding Shares) as giving rise to income, gain, loss, deduction, credit or proceeds. Any beneficial owner of Shares who received shares of the ETH Trust in the Initial Distribution, and any intermediary holding Shares of the Trust or shares of the ETH Trust, should consult their own tax advisor regarding the U.S. federal income tax consequences of the Initial Distribution, including the proper allocation of existing tax basis between Shares of the Trust and shares of the ETH Trust. Please refer to the Trust’s definitive information statement on Schedule 14C, filed with the SEC on July 18, 2024, for more information, including other U.S. federal income tax considerations relating to the Initial Distribution and ownership of shares of the ETH Trust. Critical Accounting Policies and Estimates Investment Transactions and Revenue Recognition The Trust considers investment transactions to be the receipt of Ether by the Trust in connection with Share creations and the delivery of Ether by the Trust in connection with Share redemptions or for payment of expenses in Ether. Prior to July 23, 2024, the Trust was not accepting redemption requests, however the Sponsor has since authorized the commencement of the Trust’s redemption program on July 22, 2024 in connection with the uplisting of the Shares to NYSE Arca. The Trust records its investment transactions on a trade date basis and changes in fair value are reflected as net change in unrealized appreciation or depreciation on investments. Realized gains and losses are calculated using the specific identification method. Realized gains and losses are recognized in connection with transactions including settling obligations for the Sponsor’s Fee in Ether. Principal Market and Fair Value Determination To determine which market is the Trust’s principal market (or in the absence of a principal market, the most advantageous market) for purposes of calculating the Trust’s net asset value in accordance with U.S. GAAP (“Principal Market NAV”), the Trust follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820-10, Fair Value Measurement , which outlines the application of fair value accounting. ASC 820-10 determines fair value to be the price that would be received for Ether in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Trust to assume that Ether is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Trust only receives Ether in connection with a creation order from the Authorized Participant (or a Liquidity Provider) and does not itself transact on any Digital Asset Markets. Therefore, the Trust looks to market-based volume and level of activity for Digital Asset Markets. The Authorized Participant(s), or a Liquidity Provider, may transact in a Brokered Market, a Dealer Market, Principal-to-Principal Markets and Exchange Markets (referred to as “Trading Platform Markets” in this Annual Report), each as defined in the FASB ASC Master Glossary (collectively, “Digital Asset Markets”). 96 In determining which of the eligible Digital Asset Markets is the Trust’s principal market, the Trust reviews these criteria in the following order: • First, the Trust reviews a list of Digital Asset Markets that maintain practices and policies designed to comply with anti-money laundering (“AML”) and know-your-customer (“KYC”) regulations, and non-Digital Asset Trading Platform Markets that the Trust reasonably believes are operating in compliance with applicable law, including federal and state licensing requirements, based upon information and assurances provided to it by each market. • Second, the Trust sorts these Digital Asset Markets from high to low by market-based volume and level of activity of Ether traded on each Digital Asset Market in the trailing twelve months. • Third, the Trust then reviews pricing fluctuations and the degree of variances in price on Digital Asset Markets to identify any material notable variances that may impact the volume or price information of a particular Digital Asset Market. • Fourth, the Trust then selects a Digital Asset Market as its principal market based on the highest market-based volume, level of activity and price stability in comparison to the other Digital Asset Markets on the list. Based on information reasonably available to the Trust, Trading Platform Markets have the greatest volume and level of activity for the asset. The Trust therefore looks to accessible Trading Platform Markets as opposed to the Brokered Market, Dealer Market and Principal-to-Principal Markets to determine its principal market. As a result of the aforementioned analysis, a Trading Platform Market has been selected as the Trust’s principal market. The Trust determines its principal market (or in the absence of a principal market the most advantageous market) annually and conducts a quarterly analysis to determine (i) if there have been recent changes to each Digital Asset Market’s trading volume and level of activity in the trailing twelve months, (ii) if any Digital Asset Markets have developed that the Trust has access to, or (iii) if recent changes to each Digital Asset Market’s price stability have occurred that would materially impact the selection of the principal market and necessitate a change in the Trust’s determination of its principal market. The cost basis of Ether received in connection with a creation order is recorded by the Trust at the fair value of Ether at 4:00 p.m., New York time, on the creation date for financial reporting purposes. The cost basis recorded by the Trust may differ from proceeds collected by the Authorized Participant from the sale of the corresponding Shares to investors. Investment Company Considerations The Trust is an investment company for U.S. GAAP purposes and follows accounting and reporting guidance in accordance with the FASB ASC Topic 946, Financial Services—Investment Companies . The Trust uses fair value as its method of accounting for Ether in accordance with its classification as an investment company for accounting purposes. The Trust is not a registered investment company under the Investment Company Act. U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates and these differences could be material. Review of Financial Results Financial Highlights for the Years ended December 31, 2024, 2023 and 2022 (All amounts in the following table and the subsequent paragraphs, except Share, per Share, Ether and price of Ether amounts, are in thousands) For the Years Ended December 31, 2024 2023 2022 Net realized and unrealized gain (loss) on investment in Ether (1) $ 2,767,727 $ 3,243,340 $ (7,549,251 ) Net increase (decrease) in net assets resulting from operations $ 2,585,133 $ 3,108,856 $ (7,702,493 ) Net assets (2) $ 4,735,980 $ 6,758,054 $ 3,649,198 (1) Includes the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4 of the notes to the financial statements. (2) Net assets in the above table and subsequent paragraphs are calculated in accordance with U.S. 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. 97 Net realized and unrealized gain on investment in Ether for the year ended December 31, 2024 was $2,767,727, which includes a realized gain of $157,557 on the transfer of Ether to pay the Sponsor’s Fee, a realized gain of $3,108,025 on the sale of Ether to meet redemptions, a realized gain of $888,140 on the sale of Ether related to the Initial Distribution to Grayscale Ethereum Mini Trust ETF, and net change in unrealized appreciation on investment in Ether of ($1,385,995). Net realized and unrealized gain on investment in Ether for the year was driven by Ether price appreciation from $2,281.10 per Ether as of December 31, 2023, to $3,340.40 per Ether as of December 31, 2024. Net increase in net assets resulting from operations was $2,585,133 for the year ended December 31, 2024, which consisted of the net realized and unrealized gain on investment in Ether, less the Sponsor’s Fee of $182,594. Net assets decreased to $4,735,980 at December 31, 2024, a 30% decrease for the year. The decrease in net assets resulted from the aforementioned Ether price appreciation, partially offset by the withdrawal of approximately 59,535 Ether to pay the foregoing Sponsor’s Fee, the redemption of approximately 1,197,072 Ether, with a value of $3,611,158 from the Trust, and the Initial Distribution of approximately 292,263 Ether, with a value of $1,010,935 from the Trust to Grayscale Ethereum Mini Trust ETF, partially offset by the aforementioned Ether price appreciation and the contribution of approximately 4,028 Ether, with a value of $14,886 to the Trust in connection with Share creations during the year. Net realized and unrealized gain on investment in Ether for the year ended December 31, 2023 was $3,243,340, which includes a realized gain of $102,973 on the transfer of Ether to pay the Sponsor’s Fee and net change in unrealized appreciation on investment in Ether of $3,140,367. Net realized and unrealized gain on investment in Ether for the year was driven by Ether price appreciation from $1,201.33 per Ether as of December 31, 2022, to $2,281.10 per Ether as of December 31, 2023. Net increase in net assets resulting from operations was $3,108,856 for the year ended December 31, 2023, which consisted of the net realized and unrealized gain on investment in Ether, less the Sponsor’s Fee of $134,484. Net assets increased to $6,758,054 at December 31, 2023, an 85% increase for the year. The increase in net assets resulted from the aforementioned Ether price appreciation, partially offset by the withdrawal of approximately 75,001 Ether to pay the foregoing Sponsor’s Fee. Net realized and unrealized loss on investment in Ether for the year ended December 31, 2022 was ($7,549,251), which includes a realized gain of $120,933 on the transfer of Ether to pay the Sponsor’s Fee, and net change in unrealized appreciation on investment in Ether of ($7,670,184). Net realized and unrealized loss on investment in Ether for the year was driven by Ether price depreciation from $3,644.75 per Ether as of December 31, 2021, to $1,201.33 per Ether as of December 31, 2022. Net decrease in net assets resulting from operations was ($7,702,493) for the year ended December 31, 2022, which consisted of the net realized and unrealized loss on investment in Ether, plus the Sponsor’s Fee of $153,242. Net assets decreased to $3,649,198 at December 31, 2022, a 68% decrease for the year. The decrease in net assets resulted from the aforementioned Ether price depreciation and the withdrawal of approximately 76,901 Ether to pay the foregoing Sponsor’s Fee. Cash Resources and Liquidity The Trust only receives and holds cash in order to facilitate creations and redemptions pursuant to Cash Orders, and has not otherwise had or maintained a cash balance at any time since inception. When selling Ether in the Digital Asset Market to pay Additional Trust Expenses on behalf of the Trust, the Sponsor endeavors to sell the exact amount of Ether needed to pay expenses in order to minimize the Trust’s holdings of assets other than Ether. In addition, upon the consummation or deemed failure of a Cash Order to create or redeem Baskets, the Trust will promptly return any excess cash it continues to hold with respect to such Cash Order to the applicable counterparty. As a consequence, the Sponsor expects that the Trust will not record any cash flow from its operations and that its cash balance will be zero at the end of each reporting period. Furthermore, the Trust is not a party to any off-balance sheet arrangements. Generally, the Trust does not intend to hold cash, except in connection with Cash Orders for creations or redemptions of Baskets. Cash includes non-interest bearing non-restricted cash with one institution. Cash in a bank deposit account, at times, may exceed U.S. federally insured limits. The Trust has not experienced any losses in such accounts and does not believe it is exposed to any significant credit risk on such bank deposits. In exchange for the Sponsor’s Fee, the Sponsor has agreed to assume most of the expenses incurred by the Trust. As a result, the only ordinary expense of the Trust during the periods covered by this Annual Report was the Sponsor’s Fee. 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. 98 Selected Operating Data For the Years Ended December 31, 2024 2023 2022 (All Ether balances are rounded to the nearest whole Ether) Ether: Opening balance 2,962,630 3,037,631 3,114,532 Creations 4,028 - - Redemptions (1,197,072 ) - - Initial Distribution (Return of Capital) (1) (292,263 ) - - Sponsor’s Fee, related party (59,535 ) (75,001 ) (76,901 ) Closing balance 1,417,788 2,962,630 3,037,631 Accrued but unpaid Sponsor’s Fee, related party - - - Net closing balance 1,417,788 2,962,630 3,037,631 Number of Shares: Opening balance 310,158,500 310,158,500 310,158,500 Creations 480,000 - - Redemptions (141,540,000 ) - - Closing balance 169,098,500 310,158,500 310,158,500 December 31, 2024 2023 2022 Price of Ether on principal market (2) $ 3,340.40 $ 2,281.10 $ 1,201.33 Principal Market NAV per Share (3) $ 28.01 $ 21.79 $ 11.77 Index Price (4) $ 3,343.74 $ 2,280.96 $ 1,201.41 NAV per Share (4) $ 28.04 $ 21.79 $ 11.77 (1) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4 of the notes to the financial statements. (2) The Trust performed an assessment of the principal market at December 31, 2024 and identified the principal market as Crypto.com. The Trust performed an assessment of the principal market at December 31, 2023 and 2022, and identified the principal market as Coinbase. (3) As of December 31, 2024, 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 December 31, 2023 and 2022, 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. Prior to February 23, 2024, Principal Market NAV was referred to as NAV and Principal Market NAV per Share was referred to as NAV per Share. (4) 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. The Trust’s NAV per Share is calculated using a non-GAAP methodology where the price is derived from multiple Digital Asset Trading Platforms. Prior to February 23, 2024, NAV was referred to as Digital Asset Holdings and NAV per Share was referred to as Digital Asset Holdings per Share. See “Item 1. Business—Overview of the Ethereum Industry and Market—Ether Value—The Index and the Index Price” for a description of the Index and the Index Price. The Digital Asset Trading Platforms included in the Index as of December 31, 2024 were Coinbase, Kraken, LMAX Digital, and Crypto.com. The Digital Asset Trading Platforms included in the Index as of December 31, 2023 were Coinbase, Kraken, LMAX Digital, and Crypto.com. The Digital Asset Trading Platforms included in the Index as of December 31, 2022 were Coinbase, Kraken, and LMAX Digital. 99 For accounting purposes, prior to July 23, 2024, the Trust reflected creations and the Ether receivable for proceeds with respect to such creations on the date of receipt of a notification of a creation but did not issue Shares until the requisite amount of Ether for proceeds was received. On July 22, 2024, in connection with the approval of application under Rule 19b-4 of the Securities Exchange Act of 1934 on May 23, 2024 and the effectiveness of the registration statement on Form S-3, as amended, the Sponsor authorized the commencement of a redemption program. Effective July 23, 2024, the date on which the Shares of the Trust began trading on NYSE Arca, the Trust reflects creations and redemptions and the Ether for proceeds receivable or payable with respect to such creations and redemptions, respectively, on the business day following the receipt of a notification of a creation or redemption order by an Authorized Participant. 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 December 31, 2024, the Trust had a net closing balance of 1,417,788.29257515 Ether with a value of $4,740,715,425, based on the Index Price of $3,343.74 on December 31, 2024 (non-GAAP methodology). As of December 31, 2024, the total market value of the Trust’s Ether was $4,735,980,013, based on the price of one Ether on the principal market (Crypto.com) of $3,340.40 on December 31, 2024. As of December 31, 2023, the Trust had a net closing balance of 2,962,629.50149940 Ether with a value of $6,757,639,388, based on the Index Price of $2,280.96 on December 31, 2023 (non-GAAP methodology). As of December 31, 2023, the total market value of the Trust’s Ether was $6,758,054,156, based on the price of one Ether on the principal market (Coinbase) of $2,281.10 on December 31, 2023. As of December 31, 2022, the Trust had a net closing balance of 3,037,631.42522860 Ether with a value of $3,649,440,771, based on the Index Price of $1,201.41 on December 31, 2022 (non-GAAP methodology). As of December 31, 2022, the total market value of the Trust’s Ether was $3,649,197,760, based on the price of one Ether on the principal market (Coinbase) of $1,201.33 on December 31, 2022. Historical NAV and Ether Prices As movements in the price of Ether will directly affect the price of the Shares, investors should understand recent movements in the price of Ether. Investors, however, should also be aware that past movements in the Ether price are not indicators of future movements. 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 Trust’s performance prior to July 23, 2024 is based on market-determined prices on the OTCQX marketplace and on the Trust’s performance without an ongoing share creation and redemption program. Prior to July 23, 2024, the Trust’s Shares traded at both premiums and discounts to the value of the Trust’s assets, less its expenses and other liabilities, which at times were substantial, in part due to the lack of an ongoing redemption program. Effective as of July 23, 2024, the Trust established an ongoing share creation and redemption program and the Shares of the Trust were listed to NYSE Arca. Hence, the Trust’s performance for periods prior to July 23, 2024 is not directly comparable to, and should not be used to make conclusions in conjunction with, the Trust’s performance for periods subsequent to July 23, 2024. 100 The following chart illustrates the movement in the Trust’s NAV per Share (as adjusted for the Share Split for periods prior to December 17, 2020) versus the Index Price and the Trust’s Principal Market NAV per Share (as adjusted for the Share Split for periods prior to December 17, 2020) from December 14, 2017 (the inception of the Trust’s operations) to December 31, 2024. 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.” 101 The following table illustrates the movements in the Index Price from January 1, 2020 to December 31, 2024. During such period, the Index Price has ranged from $109.83 to $4,776.32, with the straight average being $1,981.09 through December 31, 2024. The Sponsor has not observed a material difference between the Index Price and average prices from the Constituent Trading Platforms individually or as a group. High Low Period Average Index Price Date Index Price Date End of period Last business day Twelve months ended December 31, 2020 $ 307.03 $ 752.13 12/30/2020 $ 109.83 3/16/2020 $ 745.01 $ 745.01 Twelve months ended December 31, 2021 $ 2,775.83 $ 4,776.32 11/9/2021 $ 731.87 1/1/2021 $ 3,644.98 $ 3,644.98 Twelve months ended December 31, 2022 $ 1,987.92 $ 3,816.94 1/4/2022 $ 913.51 6/18/2022 $ 1,201.41 $ 1,196.71 Twelve months ended December 31, 2023 $ 1,793.93 $ 2,375.87 12/10/2023 $ 1,200.90 1/1/2023 $ 2,280.96 $ 2,305.90 Twelve months ended December 31, 2024 $ 3,042.44 $ 4,050.21 12/6/2024 $ 2,198.66 1/23/2024 $ 3,343.74 $ 3,343.74 January 1, 2020 to December 31, 2024 $ 1,981.09 $ 4,776.32 11/9/2021 $ 109.83 3/16/2020 $ 3,343.74 $ 3,343.74 The following table illustrates the movements in the Digital Asset Market price of Ether, as reported on the Trust’s principal market, from January 1, 2020 to December 31, 2024. During such period, the price of Ether has ranged from $110.29 to $4,776.95, with the straight average being $1,981.11 through December 31, 2024. High Low Period Average Digital Asset Market Price Date Digital Asset Market Price Date End of period Last business day Twelve months ended December 31, 2020 $ 307.02 $ 751.88 12/30/2020 $ 110.29 3/16/2020 $ 744.99 $ 744.99 Twelve months ended December 31, 2021 $ 2,775.91 $ 4,776.95 11/9/2021 $ 731.87 1/1/2021 $ 3,644.75 $ 3,644.75 Twelve months ended December 31, 2022 $ 1,987.98 $ 3,816.02 1/4/2022 $ 913.24 6/18/2022 $ 1,201.33 $ 1,196.81 Twelve months ended December 31, 2023 $ 1,793.98 $ 2,376.20 12/10/2023 $ 1,200.85 1/1/2023 $ 2,281.10 $ 2,304.67 Twelve months ended December 31, 2024 $ 3,042.34 $ 4,053.28 12/6/2024 $ 2,197.00 1/23/2024 $ 3,340.40 $ 3,340.40 January 1, 2020 to December 31, 2024 $ 1,981.11 $ 4,776.95 11/9/2021 $ 110.29 3/16/2020 $ 3,340.40 $ 3,340.40 Secondary Market Trading On May 23, 2024, the SEC approved an application under Rule 19b-4 of the Securities Exchange Act of 1934, as amended by NYSE Arca to list the Shares of the Trust, which began trading on NYSE Arca under the symbol “ETHE” on July 23, 2024, following the effectiveness of the Trust’s registration statement on Form S-3, as amended (File No. 333-278880). Historically, the Trust’s Shares have been quoted on OTCQX under the symbol “ETHE” from June 20, 2019 through July 22, 2024. The price of the Shares as quoted on OTCQX has varied significantly from the Trust’s NAV per Share. From June 20, 2019 to July 22, 2024, the maximum premium of the closing price of the Shares quoted on OTCQX over the value of the Trust’s NAV per Share was 956%, the average premium was 191%, the maximum discount of the closing price of the Shares quoted on OTCQX below the value of the Trust’s NAV per Share was 60%, and the average discount was 23%. As of July 22, 2024, the Trust’s Shares were quoted on OTCQX at a discount of 0.1% to the Trust’s NAV per Share. 102 The following table sets out the range of high and low closing prices for the Shares as reported by OTCQX, the Trust’s Principal Market NAV per Share calculated in accordance with U.S. GAAP and the Trust’s NAV per Share for each of the quarters from January 1, 2022 through July 22, 2024. High Low OTCQX (3) Principal Market NAV per Share (1) NAV per Share (2) OTCQX Principal Market NAV per Share (1) NAV per Share (2) 2022 First quarter $ 33.72 $ 38.31 $ 38.32 $ 18.03 $ 23.45 $ 23.44 Second quarter $ 28.56 $ 34.85 $ 34.84 $ 7.06 $ 9.06 $ 9.07 Third quarter $ 15.20 $ 19.54 $ 19.55 $ 7.22 $ 10.31 $ 10.32 Fourth quarter $ 10.91 $ 16.21 $ 16.20 $ 4.72 $ 10.84 $ 10.84 2023 First quarter $ 8.58 $ 17.80 $ 17.80 $ 4.82 $ 11.76 $ 11.76 Second quarter $ 10.92 $ 20.58 $ 20.58 $ 7.36 $ 16.15 $ 16.13 Third quarter $ 12.06 $ 19.30 $ 19.30 $ 9.65 $ 14.81 $ 14.81 Fourth quarter $ 20.71 $ 22.73 $ 22.73 $ 10.71 $ 14.70 $ 14.71 2024 First quarter $ 34.49 $ 38.34 $ 38.34 $ 17.51 $ 20.95 $ 20.97 Second quarter $ 36.01 $ 36.66 $ 36.64 $ 20.63 $ 27.37 $ 27.37 Third quarter (3) $ 32.61 $ 32.76 $ 32.75 $ 27.85 $ 28.15 $ 28.14 (1) The Principal Market NAV is calculated using the fair value of Ether based on the price provided by the Digital Asset Market that the Trust considers its principal market, which prior to December 31, 2024, was Coinbase. The Trust performed an assessment of the principal market at December 31, 2024, and identified the principal market as Crypto.com. Prior to February 23, 2024, Principal Market NAV was referred to as NAV and Principal Market NAV per Share was referred to as NAV per Share. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Principal Market and Fair Value Determination.” (2) 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. The Index Price is calculated using non-GAAP methodology and is not used in the Trust’s financial statements, unless otherwise disclosed. Prior to February 23, 2024, NAV was referred to as Digital Asset Holdings and NAV per Share was referred to as Digital Asset Holdings per Share. See “Item 1. Business—Valuation of Ether and Determination of NAV.” (3) As of July 23, 2024, Shares of the Trust began trading on NYSE Arca under the symbol “ETHE.” Therefore, this represents the period from June 30, 2024 through July 22, 2024. As of July 23, 2024, Shares of the Trust began trading on NYSE Arca under the symbol “ETHE,” following the effectiveness of the Trust’s registration statement on Form S-3, as amended (File No. 333-278880). From July 23, 2024 to December 31, 2024, the maximum premium of the closing price of the Shares listed on NYSE Arca over the value of the Trust’s NAV per Share was 1.6%, the average premium was 0.1%, the maximum discount of the closing price of the Shares listed on NYSE Arca below the value of the Trust’s NAV per Share was 0.2%, and the average discount was 0.1%. As of December 31, 2024, the last business day of the period, the Trust’s Shares were listed on NYSE Arca at a discount of 0.1% to the Trust’s NAV per Share. 103 The following table sets out the range of high and low closing prices for the Shares as reported by NYSE Arca, the Trust’s Principal Market NAV per Share calculated in accordance with U.S. GAAP and the Trust’s NAV per Share for each of the quarters from July 23, 2024 through December 31, 2024. High Low NYSE Arca (3) Principal Market NAV per Share (1) NAV per Share (2) NYSE Arca Principal Market NAV per Share (1) NAV per Share (2) 2024 Third quarter (3) $ 29.35 $ 29.32 $ 29.30 $ 18.75 $ 18.76 $ 18.78 Fourth quarter $ 34.07 $ 34.04 $ 34.02 $ 19.85 $ 19.85 $ 19.85 (1) The Principal Market NAV is calculated using the fair value of Ether based on the price provided by the Digital Asset Market that the Trust considers its principal market, which prior to December 31, 2024, was Coinbase. The Trust performed an assessment of the principal market at December 31, 2024, and identified the principal market as Crypto.com. Prior to February 23, 2024, Principal Market NAV was referred to as NAV and Principal Market NAV per Share was referred to as NAV per Share. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Principal Market and Fair Value Determination.” (2) 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. The Index Price is calculated using non-GAAP methodology and is not used in the Trust’s financial statements, unless otherwise disclosed. Prior to February 23, 2024, NAV was referred to as Digital Asset Holdings and NAV per Share was referred to as Digital Asset Holdings per Share. See “Item 1. Business—Valuation of Ether and Determination of NAV.” (3) As of July 23, 2024, Shares of the Trust began trading on NYSE Arca under the symbol “ETHE.” Therefore, this represents the period from July 23, 2024 through September 30, 2024. The Trust’s performance prior to July 23, 2024 is based on market-determined prices on the OTCQX marketplace and on the Trust’s performance without an ongoing share creation and redemption program. Prior to July 23, 2024, the Trust’s Shares traded at both premiums and discounts to the value of the Trust’s assets, less its expenses and other liabilities, which at times were substantial, in part due to the lack of an ongoing redemption program. Effective as of July 23, 2024, the Trust established an ongoing share creation and redemption program and the Shares of the Trust were listed to NYSE Arca. Hence, the Trust’s performance for periods prior to July 23, 2024 are not directly comparable to, and should not be used to make conclusions in conjunction with, the Trust’s performance for periods subsequent to July 23, 2024. 104 The following chart sets out the historical closing prices for the Shares as reported by OTCQX and the Trust’s NAV per Share from June 20, 2019 to July 22, 2024. ETHE Premium/(Discount): ETHE Share Price vs. NAV per Share (Non-GAAP) ($) The following chart sets out the historical closing prices for the Shares as reported by NYSE Arca from July 23, 2024 to December 31, 2024 and the Trust’s NAV per Share from July 23, 2024 to December 31, 2024. ETHE Premium/(Discount): ETHE Share Price vs. NAV per Share (Non-GAAP) ($) 105 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 OTCQX and the Trust’s NAV per Share from June 20, 2019 to July 22, 2024. ETHE Premium/(Discount): ETHE Share Price vs. 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 to December 31, 2024 divided by the Trust’s NAV per Share from July 23, 2024 to December 31, 2024. ETHE Premium/(Discount): ETHE Share Price vs. NAV per Share (Non-GAAP) (%) 106 Recent Developments On January 1, 2025, Grayscale Investments, LLC (“GSI”) consummated an internal corporate reorganization (the “Reorganization”), pursuant to which Grayscale Investments, LLC, the Sponsor of the Trust prior to the Reorganization, merged with and into Grayscale Operating, LLC (“GSO”), a Delaware limited liability company and a wholly owned indirect 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. The Reorganization is not expected to have any material impact on the operations of the Trust. In connection with the Reorganization, on January 1, 2025, and promptly following the effectiveness of the Merger, GSO assigned certain contracts pertaining to its role as Sponsor (as such term is defined in the Trust Agreement) of the Trust (such contracts, the “Sponsor Contracts”) to Grayscale Investments Sponsors, LLC, a Delaware limited liability company and a wholly owned direct subsidiary of GSO (“GSIS”), whereby GSIS assumed all of the rights and obligations of GSO under the Sponsor Contracts. Other than the assumption of the Sponsor Contracts by GSIS, the Reorganization does not alter the rights or obligations under any of the Sponsor Contracts. In connection with the Reorganization, on January 1, 2025, and promptly following the effectiveness of the Merger, GSO and GSIS executed a Certificate of Admission, pursuant to which GSIS was admitted as an additional Sponsor of the Trust under the Trust Agreement, by and among GSO (as successor in interest to GSI), the Trustee, and the shareholders from time to time thereunder, as amended from time to time. GSIS shall be subject to the rights and obligations of a Sponsor under the Trust Agreement. On January 3, 2025, GSO voluntarily withdrew as a Sponsor of the Trust pursuant to the terms of the Trust Agreement, and, effective May 3, 2025, GSIS shall be the sole remaining Sponsor of the Trust. Item 7A. Quantitative and Qualitat ive Disclosures about Market Risk The Trust Agreement does not authorize the Trust to borrow for payment of the Trust’s ordinary expenses. The Trust does not engage in transactions in foreign currencies which could expose the Trust or holders of Shares to any foreign currency related market risk. The Trust does not invest in derivative financial instruments and has no foreign operations or long-term debt instruments. Item 8. Financial Statemen ts and Supplementary Data See Index to Financial Statements on page F-1 for a list of the financial statements being filed therein. 107 Item 9. Changes in and Disagreements with Accou ntants on Accounting and Financial Disclosure There have been no disagreements with accountants on any matter of accounting principles or practices or financial statement disclosures during the year ended December 31, 2024. Item 9A. Control s and Procedures Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures The Trust maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Principal Executive Officer and Principal Financial and Accounting Officer of the Sponsor, and to the audit committee of the Sponsor, as appropriate, to allow timely decisions regarding required disclosure. Under the supervision and with the participation of the Principal Executive Officer and the Principal Financial and Accounting Officer of the Sponsor, the Sponsor conducted an evaluation of the Trust’s disclosure controls and procedures, as defined under Exchange Act Rule 13a-15(e). Based on this evaluation, the Principal Executive Officer and the Principal Financial and Accounting Officer of the Sponsor concluded that, as of December 31, 2024, the Trust’s disclosure controls and procedures were effective. Management’s Report on Internal Control over Financial Reporting The Sponsor’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined under Exchange Act Rules 13a-15(f) and 15d-15(f). The Trust’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States. Internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Trust’s assets, (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the Trust’s receipts and expenditures are being made only in accordance with appropriate authorizations; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Trust’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become ineffective because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. The Principal Executive Officer and Principal Financial and Accounting Officer of the Sponsor assessed the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2024. In making this assessment, they used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013). Their assessment included an evaluation of the design of the Trust’s internal control over financial reporting and testing of the operational effectiveness of its internal control over financial reporting. Based on their assessment and those criteria, the Principal Executive Officer and Principal Financial and Accounting Officer of the Sponsor concluded that the Trust maintained effective internal control over financial reporting as of December 31, 2024. KPMG LLP, the independent registered public accounting firm that audited the financial statements as of and for the year ended December 31, 2024 included in this Annual Report on Form 10-K, as stated in their report which is included herein, issued an attestation report on the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2024 on page F- 2 . Changes in Internal Control Over Financial Reporting There was no change in the Trust’s internal controls over financial reporting that occurred during the Trust’s most recently completed fiscal quarter ended December 31, 2024 that has materially affected, or is reasonably likely to materially affect, these internal controls. Item 9B. Other Information Not applicable . Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 108 PART III Item 10. Directors, Executive Of ficers and Corporate Governance Management of the Sponsor The Trust does not have any directors, officers or employees. Under the Trust Agreement, all management functions of the Trust have been delegated to and are conducted by the Sponsor, its agents and its affiliates, including without limitation, the Custodian and its agents. As officers of the Sponsor, Peter Mintzberg, the principal executive officer of the Sponsor, and Edward McGee, the principal financial and accounting officer of the Sponsor, may take certain actions and execute certain agreements and certifications for the Trust, in their capacity as the principal officers of the Sponsor. As of and prior to December 31, 2024, GSI had a board of directors that was responsible for managing and directing the affairs of the Sponsor. From and after January 1, 2025, GSO Intermediate Holdings Corporation (“GSOIH”), a Delaware corporation formed in connection with the Reorganization, which is the sole managing member of GSO and an indirect subsidiary of DCG, has a board of directors (each such board of directors, the “Board”). The Board consists of Mark Shifke, Matthew Kummell, Mr. Mintzberg, and Mr. McGee. Mr. Mintzberg and Mr. McGee also retain the authority granted to them as officers under the limited liability company agreement of the Sponsor. The Sponsor has an Audit Committee. The Audit Committee has the responsibility for overseeing the financial reporting process of the Trust, including the risks and controls of that process and such other oversight functions as are typically performed by an audit committee of a public company. The Audit Committee consists of Mr. McGee and Hugh Ross, Chief Operating Officer of the Sponsor. The Sponsor has a code of ethics (the “Code of Ethics”) that applies to its executive officers and agents. The Code of Ethics is available by writing the Sponsor at 290 Harbor Drive, 4th Floor, Stamford, Connecticut 06902 or calling the Sponsor at (212) 668-1427. The Sponsor’s Code of Ethics is intended to be a codification of the business and ethical principles that guide the Sponsor, and to deter wrongdoing, to promote honest and ethical conduct, to avoid conflicts of interest, and to foster compliance with applicable governmental laws, rules and regulations, the prompt internal reporting of violations and accountability for adherence to this code. During the year ended December 31, 2024, references to the “Sponsor” in this section refer to GSI, and thereafter refer to GSO or GSIS, as applicable. In connection with the Reorganization, the former Board of GSI was reconstituted at GSOIH. The members of the Board of GSOIH are the same as the members of the Board of GSI prior to the Reorganization. Additionally, the former Audit Committee of GSI was reconstituted at GSIS. The members of the Audit Committee of GSIS are the same as the members of the Audit Committee of GSI prior to the Reorganization. From and after January 1, 2025, any references to the Board in this section refer to the Board of GSOIH and any references to the Audit Committee in this section refer to the Audit Committee of GSIS. Mark Shifke, Chairman of the Board Mark Shifke, 65, is the Chief Financial Officer of DCG and has served as chairman of the Board since January 2024. Since March 2021, Mr. Shifke has served on the board of directors of Dock Ltd., a full-stack payments and digital banking platform. Since September 2023, Mr. Shifke has served on the board of directors of Luno, a cryptocurrency platform. Mr. Shifke has nearly four decades of financial and fintech experience, and more than eight years of CFO experience leading two publicly-traded companies. Prior to joining DCG, Mr. Shifke served as CFO of Billtrust, a company focused on providing AR and cloud-based solutions around payments, and as CFO of Green Dot (NYSE: GDOT), a mobile banking company and payments platform. Previously, Mr. Shifke led teams at JPMorgan Chase and Goldman Sachs, specializing in M&A Structuring and Advisory, as well as Tax Asset Investments. Mr. Shifke also served as the Head of International Structured Finance Group at KPMG. Mr. Shifke began his career at Davis Polk, where he was a partner. He is a graduate of Tulane University (B.A./J.D.) and the New York University School of Law (LL.M. in Taxation). Matthew Kummell, Board Member Matt Kummell, 49, is Senior Vice President of Strategy & Operations at DCG and has served as a director of the Sponsor since January 2024. In his role at DCG, Mr. Kummell leads the business’s post-investment efforts, including investment operations and value creation with regard to DCG’s portfolio companies. Since December 2023, Mr. Kummell has served as a member of the board of directors of Foundry, a digital asset mining and staking company. Until November 2023, Mr. Kummell served on the board of directors of CoinDesk, Inc., a digital media, events and information services company for the crypto asset and blockchain technology community. Until January 2012, Mr. Kummell served on the board of directors of Derivix Corporation, a financial services software company. Prior to joining DCG, Mr. Kummell was the Head of North America for Citi’s Business Advisory Services team, a strategic consulting practice focused on institutional investor clients in Citi’s Markets division. Mr. Kummell has also held strategic and front-office leadership roles at Citadel, Balyasny Asset Management, and S.A.C. Capital Advisors, the predecessor to Point 72 Asset Management. Previously, Mr. Kummell served as a case team leader at Bain & Company in its Boston headquarters. Mr. Kummell is an Adjunct Professor at the Tuck School of Business at Dartmouth College. He is a graduate of the University of California, Los Angeles (B.A.) and the Tuck School of Business at Dartmouth College (MBA). 109 Peter Mintzberg, Board Member and Chief Executive Officer Peter Mintzberg, 56, has been the Chief Executive Officer of the Sponsor and has served as a director of the Sponsor since August 2024. Mintzberg joins the Sponsor from Goldman Sachs, where he served as Global Head of Strategy for Asset and Wealth Management. Prior, he held several global leadership roles in Strategy, M&A, and Investor Relations at BlackRock, Apollo, OppenheimerFunds, and Invesco. With deep knowledge across a broad base of client types and asset classes, Mintzberg has over two decades of experience developing and executing strategy and innovating to drive growth. Mintzberg started his career working at McKinsey & Co. in New York, San Francisco, and São Paulo, focused on the financial services and technology sectors. Mintzberg was recognized as a Latino leader in Finance by The Alumni Society in 2018, and was selected as a David Rockefeller Fellow in the 2016-2017 Class by the Partnership for New York City. He earned a bachelor’s degree in engineering from the Universidade Federal Rio de Janeiro, and an MBA from Harvard University. Edward McGee, Board Member and Chief Financial Officer Edward McGee, 41, has been the Chief Financial Officer of the Sponsor since January 2022 and has served as a director of the Sponsor since January 2024. Before serving as CFO, Mr. McGee was Vice President, Finance and Controller of the Sponsor since June 2019. Prior to taking on his role at the Sponsor, Mr. McGee served as a Vice President, Accounting Policy at Goldman, Sachs & Co. providing coverage to their SEC Financial Reporting team facilitating the preparation and review of their financial statements and provided U.S. GAAP interpretation, application and policy development while servicing their Special Situations Group, Merchant Banking Division and Urban Investments Group from 2014 to 2019. From 2011 to 2014, Mr. McGee was an auditor at Ernst & Young providing assurance services to publicly listed companies. Mr. McGee earned his Bachelor of Science degree in accounting from the John H. Sykes College of Business at the University of Tampa and graduated with honors while earning his Master of Accountancy in Financial Accounting from the Rutgers Business School at the State University of New Jersey. Mr. McGee is a Certified Public Accountant licensed in the state of New York. Hugh Ross, Chief Operating Officer Hugh Ross, 57, has been the Chief Operating Officer of the Sponsor since February 2021. Prior to joining the Sponsor, Mr. Ross served twelve years as Chief Operating Officer of Horizon Kinetics LLC, a New York-based investment manager where he was responsible for the operating infrastructure and various digital asset initiatives. During the ten years immediately preceding his tenure at Horizon Kinetics, Mr. Ross was a Vice President with Goldman Sachs & Co. where he served as Chief Operating Officer of the long-only investment manager research team then-known as Global Manager Strategies (“GMS”), within Goldman Sachs Asset Management (“GSAM”). Mr. Ross also served as a compliance officer for both GSAM and Goldman’s Private Wealth Management business. Prior to joining Goldman Sachs, Mr. Ross worked as an in-house counsel for a transfer agent and started his career as a securities industry attorney representing broker-dealers and investment advisers. Mr. Ross is a graduate of the Goizueta Business School at Emory University (B.B.A.) and New York Law School (J.D.). Item 11. Executi ve Compensation Not applicable. Item 12. Security Ownership of Certain Beneficial Ow ners and Management and Related Stockholder Matters Securities Authorized for Issuance under Equity Compensation Plans and Related Stockholder Matters Not applicable. 110 Security Ownership of Certain Beneficial Owners and Management The Trust does not have any directors, officers or employees. The following table sets forth certain information with respect to the beneficial ownership of the Shares for (i) each person that, to the Sponsor’s knowledge based on the records of the Transfer Agent and other ownership information provided to the Sponsor, owns beneficially a significant portion of the Shares; (ii) each director and executive officer of the Sponsor individually; and (iii) all directors and executive officers of the Sponsor as a group. The number of Shares beneficially owned and percentages of beneficial ownership set forth below are based on the number of Shares outstanding as of February 24, 2025. In accordance with the rules of the SEC, beneficial ownership includes voting or investment power with respect to securities. Name and Address of Beneficial Owner Amount and Nature of Beneficial Ownership Percentage of Beneficial Ownership Significant Shareholders: Digital Currency Group, Inc. (1) * * % Directors & Executive Officers of the Sponsor: (2) Mark Shifke * * % Matthew Kummell * * % Peter Mintzberg * * % Edward McGee * * % Hugh Ross * * % Directors & executive officers of the Sponsor as a group * * % (1) On March 2, 2022, the Board approved the purchase by DCG, the indirect parent company of the Sponsor, of up to an aggregate total of $200 million worth of Shares of the Trust and shares of any of the following five investment products the Sponsor also acts as the sponsor and manager of, including Grayscale Bitcoin Trust ETF (NYSE Arca: GBTC), Grayscale Bitcoin Cash Trust (BCH) (OTCQX: BCHG), Grayscale Digital Large Cap Fund LLC (OTCQX: GDLC), Grayscale Stellar Lumens Trust (XLM) (OTCQX: GXLM), and Grayscale Ethereum Classic Trust (ETC) (OTCQX: ETCG). The Share purchase authorization does not obligate DCG to acquire any specific number of Shares in any period, and may be expanded, extended, modified, or discontinued at any time. From March 2, 2022 through February 24, 2025, DCG did not purchase any Shares of the Trust under this authorization. (2) The Trust does not have any directors, officers or employees. Under the Trust Agreement, all management functions of the Trust have been delegated to and are conducted by the Sponsor, its agents and its affiliates. * Represents beneficial ownership of less than 1%. Unless otherwise indicated, the address for each shareholder listed in the table above is c/o Grayscale Investments Sponsors, LLC, 290 Harbor Drive, 4 th Floor, Stamford, Connecticut 06902. Item 13. Certain Relationships and Relate d Transactions and Director Independence General The Sponsor has not established formal procedures to resolve all potential conflicts of interest. Consequently, shareholders may be dependent on the good faith of the respective parties subject to such conflicts to resolve them equitably. Although the Sponsor attempts to monitor these conflicts, it is extremely difficult, if not impossible, for the Sponsor to ensure that these conflicts do not, in fact, result in adverse consequences to the Trust. The Sponsor presently intends to assert that shareholders have, by subscribing for Shares of the Trust, consented to the following conflicts of interest in the event of any proceeding alleging that such conflicts violated any duty owed by the Sponsor to investors. Digital Currency Group, Inc. DCG is (i) the sole equity holder and indirect parent company of the Sponsor, (ii) the indirect parent company of Grayscale Securities, the Authorized Participant from October 3, 2022 through July 22, 2024, and (iii) a minority interest holder in Kraken, one of the Digital Asset Trading Platforms included in the Index, representing less than 1.0% of its equity. DCG has investments in a large number of digital assets and companies involved in the digital asset ecosystem, including trading platforms and custodians. DCG’s positions on changes that should be adopted in the Ethereum Network could be adverse to positions that would benefit the Trust or its shareholders. Additionally, before or after a hard fork, DCG’s position regarding which fork among a group of incompatible forks of the Ethereum Network should be considered the “true” Ethereum Network could be adverse to positions that would most benefit the Trust. 111 The Sponsor The Sponsor has a conflict of interest in allocating its own limited resources among, when applicable, different clients and potential future business ventures, to each of which it owes fiduciary duties. Additionally, the professional staff of the Sponsor also services other affiliates of the Trust, including several other digital asset investment vehicles, and their respective clients. Although the Sponsor and its professional staff cannot and will not devote all of its or their respective time or resources to the management of the affairs of the Trust, the Sponsor intends to devote, and to cause its professional staff to devote, sufficient time and resources to manage properly the affairs of the Trust consistent with its or their respective fiduciary duties to the Trust and others. The Sponsor and Grayscale Securities are affiliates of each other, and the Sponsor may engage other affiliated service providers in the future. Because of the Sponsor’s affiliated status, it may be disincentivized from replacing affiliated service providers. In connection with this conflict of interest, shareholders should understand that affiliated service providers will receive fees for providing services to the Trust. Clients of the affiliated service providers may pay commissions at negotiated rates which are greater or less than the rate paid by the Trust. The Sponsor and any affiliated service provider may, from time to time, have conflicting demands in respect of their obligations to the Trust and, in the future, to other clients. It is possible that future business ventures of the Sponsor and affiliated service providers may generate larger fees, resulting in increased payments to employees, and therefore, incentivizing the Sponsor and/or the affiliated service providers to allocate it/their limited resources accordingly to the potential detriment of the Trust. There is an absence of arm’s length negotiation with respect to some of the terms of the Trust, and, where applicable, there has been no independent due diligence conducted with respect to the Trust. The Sponsor will, however, not retain any affiliated service providers for the Trust which the Sponsor has reason to believe would knowingly or deliberately favor any other client over the Trust. Authorized Participants Prior to October 3, 2022, Genesis, an affiliate of the Trust and the Sponsor, was the only Authorized Participant and was party to a participant agreement with the Sponsor and the Trust. From October 3, 2022 through July 22, 2024, Grayscale Securities, an affiliate of the Trust and the Sponsor, was the Authorized Participant. Effective July 23, 2024, the Sponsor, on behalf of the Trust, and the Transfer Agent entered into Participant Agreements with Jane Street Capital, LLC, Virtu Americas LLC, Macquarie Capital (USA) Inc., ABN AMRO Clearing USA LLC and Goldman Sachs & Co. LLC, pursuant to which such entities have agreed to act as Authorized Participants. The Sponsor may engage additional Authorized Participants who are unaffiliated with the Trust in the future. Proprietary Trading/Other Clients Because the officers of the Sponsor may trade Ether for their own personal trading accounts (subject to certain internal trading policies and procedures) at the same time as they are managing the account of the Trust, the activities of the officers of the Sponsor, subject to their fiduciary duties, may, from time-to-time, result in their taking positions in their personal trading accounts which are opposite of the positions taken for the Trust. Records of the Sponsor’s officers’ personal trading accounts will not be available for inspection by shareholders. Item 14. Principal Accou ntant Fees and Services Fees for services performed by KPMG LLP (“KPMG”), for the year ended December 31, 2024, and Marcum LLP (“Marcum”), for the year ended December 31, 2023. Years Ended December 31, 2024 2023 Audit fees $ 231,000 $ 273,000 Total $ 231,000 $ 273,000 In the table above, in accordance with the SEC’s definitions and rules, Audit Fees are fees paid to KPMG, and previously Marcum, for professional services for the audit of the Trust’s financial statements included in the annual report on Form 10-K and review of financial statements included in the quarterly reports on Form 10-Q, and for services that are normally provided by the accountants in connection with regulatory filings or engagements. Pre-Approved Policies and Procedures The Trust has no board of directors, and as a result, has no audit committee or pre-approval policy with respect to fees paid to its principal accounting firm. Such determinations, including for the fiscal year ended December 31, 2024, are made by the Sponsor’s Board of Directors and Audit Committee. From and after January 1, 2025, such determinations are made by the Board of Directors of GSOIH and the Audit Committee of GSIS. 112 PART IV Item 15. Exhibits and Fina ncial Statements Schedules 1. Financial Statements See Index to Financial Statements on Page F-1 for a list of the financial statements being filed herein. 2. Financial Statement Schedules Schedules have been omitted since they are either not required, not applicable, or the information has otherwise been included. 3. Exhibits Exhibit Number Exhibit Description 4.1 Second Amended and Restated Declaration of Trust and Trust Agreement (incorporated by reference to Exhibit 4.1 of the Form 8-K filed by the Registrant on June 12, 2024). 4.2 Amendment No. 1 to the Second Amended and Restated Declaration of Trust and Trust Agreement (incorporated by reference to Exhibit 4.1 on Form 8-K filed by the Registrant on November 4, 2024). 4.3 Form of Participant Agreement (incorporated by reference to Exhibit 4.6 to Amendment No. 1 to the Registration Statement filed by the Registrant on May 30, 2024). 4.4* Description of Registrant’s Securities. 10.1† Prime Broker Agreement, dated as of May 22, 2024, by and among the Trust, the Sponsor and the Prime Broker, on behalf of itself, the Custodian and Coinbase Credit (incorporated by reference to Exhibit 99.1 of Amendment No. 1 to the Registration Statement on Form S-3 filed by the Trust with the SEC on May 30, 2024). 10.2 Fund Administration and Accounting Agreement, dated February 26, 2024, between the Trust and the Administrator (incorporated by reference to Exhibit 10.1 on Form 8-K filed by the Registrant on February 27, 2024). 10.3* Marketing Agent Agreement, dated May 14, 2024, between the Sponsor and the Marketing Agent. 10.4† Index License Agreement (incorporated by reference to Exhibit 10.1 on Form 8-K filed by the Registrant on February 4, 2022). 10.5† Amendment No. 1 to the Index License Agreement dated June 20, 2023, between the Sponsor and Index Provider (incorporated by reference to Exhibit 10.1 on Form 8-K filed by the Registrant on June 23, 2023). 10.6†* Amendment No. 6 to the Index License Agreement dated March 1, 2025, between the Sponsor and Index Provider. 10.7 Transfer Agency and Service Agreement, dated May 8, 2024, between the Trust and the Transfer Agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed by the Registrant on May 15, 2024). 10.8 Co-Transfer Agency Agreement, dated May 22, 2024, between the Sponsor and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 99.7 to Amendment No.‌ 1 to the Registration Statement filed by the Registrant on May 30, 2024). 10.9 Assignment and Assumption Agreement (incorporated by reference to Exhibit 10.1 on Form 8-K filed by the Registrant on January 3, 2025). 10.10 Coinbase Assignment Agreement (incorporated by reference to Exhibit 10.2 on Form 8-K filed by the Registrant on January 3, 2025). 10.11 Foreside Assignment Agreement (incorporated by reference to Exhibit 10.3 on Form 8-K filed by the Registrant on January 3, 2025). 31.1* Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification by Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1* Certification by Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2* Certification by Principal Financial and Accounting Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 113 97.1* Recovery of Erroneously Awarded Compensation Policy. 101.INS* Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. 101.SCH* Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents. 104 Cover Page Interactive Data File—The cover page interactive data file does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document. * Filed herewith. † Portions of this exhibit (indicated by asterisks) have been omitted as the Registrant has determined that (i) the omitted information is not material and (ii) the omitted information is of the type that the Registrant treats as private or confidential. Item 16. Form 10-K Summary Not applicable. 114 Glossary of D efined Terms In this Annual Report, each of the following quoted terms has the meanings set forth after such term: “ Actual Exchange Rate ”—With respect to any particular asset, at any time, the price per single unit of such asset (determined net of any associated fees) at which the Trust is able to sell such asset for U.S. dollars (or other applicable fiat currency) at such time to enable the Trust to timely pay any Additional Trust Expenses, through use of the Sponsor’s commercially reasonable efforts to obtain the highest such price. “ Actual Execution Cash Order ”—A Cash Order pursuant to which any price differential between (x) the Total Basket NAV on the trade date and (y) the price realized in acquiring or disposing of the corresponding Total Basket Amount, as the case may be, will be borne solely by the Authorized Participant. “ Additional Creation Cash ”—In connection with a creation pursuant to an Actual Execution Cash Order, the amount of additional cash required to be delivered by the Authorized Participant in the event the price realized in acquiring the corresponding Total Basket Amount is higher than the Total Basket NAV on the trade date. “ Additional Redemption Cash ”—In connection with a redemption pursuant to an Actual Execution Cash Order, the amount of additional cash to be delivered to the Authorized Participant in the event the price realized in disposing the corresponding Total Basket Amount is higher than the Total Basket NAV on the trade date. “ Additional Trust Expenses ”—Together, any expenses incurred by the Trust in addition to the Sponsor’s Fee that are not Sponsor-paid Expenses, including, but not limited to, (i) taxes and governmental charges, (ii) expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of shareholders, (iii) any indemnification of the Custodian or other agents, service providers or counterparties of the Trust, (iv) the fees and expenses related to the listing, quotation or trading of the Shares on any Secondary Market (including legal, marketing and audit fees and expenses) to the extent exceeding $600,000 in any given fiscal year and (v) extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters. “ Administrator ”—The Bank of New York Mellon, a New York corporation authorized to conduct banking business. “ Administrator Fee ”—The fee payable to any administrator of the Trust for services it provides to the Trust, which the Sponsor will pay such administrator as a Sponsor-paid Expense. “ Affirmative Action ”—A decision by the Trust to acquire or abandon specific Incidental Rights and IR Virtual Currency at any time prior to the time of a creation or redemption of Shares. “ AML ”—Anti-money laundering. “ AP Designee ”—An Authorized Participant’s designee in connection with In-Kind Orders (to the extent In-Kind Regulatory Approval is obtained). “ Authorized Participant ”—Certain eligible financial institutions that have entered into an agreement with the Trust and the Sponsor concerning the creation or redemption of Shares. Each Authorized Participant (i) is a registered broker-dealer and (ii) has entered into a Participant Agreement with the Sponsor and the Transfer Agent. Subject to In-Kind Regulatory Approval, in the future any Authorized Participants creating and redeeming Shares through In-Kind Orders must also own, or their AP Designee (as defined above) must own, an Ether wallet address that is known to the Custodian as belonging to the Authorized Participant or its AP Designee and maintain an account with the Custodian. “ Basket ”—A block of 10,000 Shares. “ Basket Amount ”—On any trade date, the amount of Ether required as of such trade date for the creation or redemption of a Basket, as determined by dividing (x) the amount of Ether owned by the Trust at 4:00 p.m., New York time, on such trade date, after deducting the amount of Ether representing the U.S. dollar value of accrued but unpaid fees and expenses of the Trust (converted using the Index Price at such time, and carried to the eighth decimal place), by (y) the number of Shares outstanding at such time (with the quotient so obtained calculated to one one-hundred-millionth of one Ether ( i.e. , carried to the eighth decimal place)), and multiplying such quotient by 10,000. 115 “ Basket NAV ”—The U.S. dollar value of a Basket calculated by multiplying the Basket Amount by the Index Price as of the trade date. “ Binance ”—Binance Holdings Ltd. “ Blockchain ”—The public transaction ledger of the Ethereum Network on which transactions in Ether are recorded. “ Cash Account ”—The segregated account maintained by the Transfer Agent in the name of the Trust for purposes of receiving cash from Authorized Participants in connection with creations of Shares and distributing cash to Authorized Participants in connection with redemptions of Shares. “ Cash Order ”—An order for the creation or redemption of Shares pursuant to procedures facilitated by the Transfer Agent and pursuant to which a Liquidity Provider is engaged to facilitate the purchase or sale of Ether. A Cash Order may be executed as either a Variable Fee Cash Order or an Actual Execution Cash Order. Unless the Sponsor determines otherwise in its sole discretion based on market conditions and other factors existing at the time of such Cash Order, all creations and redemptions pursuant to Cash Orders are expected to be executed as Variable Fee Cash Orders. “ CEA ”—Commodity Exchange Act of 1936, as amended. “ CFPB ”—The Consumer Financial Protection Bureau. “ CFTC ”—The U.S. Commodity Futures Trading Commission, an independent agency with the mandate to regulate commodity futures and option markets in the United States. “ CME ”—The Chicago Mercantile Exchange. “ Code ”—The U.S. Internal Revenue Code of 1986, as amended. “ Coinbase ”—Coinbase, Inc. “ Coinbase Credit ”—Coinbase Credit, Inc. “ Co-Transfer Agent ”—Continental Stock Transfer & Trust Company. “ Covered Person ”—The Sponsor and its affiliates. See “Item 1. Business—Description of the Trust Agreement—The Sponsor—Liability of the Sponsor and Indemnification.” “ Creation Basket ”—Basket of Shares issued by the Trust upon deposit of the Basket Amount required for each such Creation Basket. “ Creation Time ”—With respect to the creation of any Shares by the Trust, the time at which the Trust creates such Shares. “ Custodial and Prime Broker Services ”—The services of the Custodian and the Prime Broker that provide for: (i) holding of the Trust’s Ether in the Vault Balance and the Settlement Balance; (ii) transfer of the Trust’s Ether between the relevant Vault Balance and the Settlement Balance; (iii) the deposit of Ether from a public blockchain address into the respective account or accounts in which the Vault Balance or the Settlement Balance are maintained; and (iv) the withdrawal of Ether from the Vault Balance to a public blockchain address the Trust controls. “ Custodial Entities ”—The Prime Broker, together with the Custodian. “ Custodian ”—Coinbase Custody Trust Company, LLC. “ Custodian Fee ”—Fee payable to the Custodian and the Prime Broker for services they provide to the Trust, which the Sponsor shall pay to the Custodian and the Prime Broker as a Sponsor-paid Expense. “ DAOs ”—Decentralized autonomous organizations. “ DCG ”—Digital Currency Group, Inc. 116 “ DCM ”—A designated contract market, which is a board of trade (commonly referred to as an exchange) that operates under the regulatory oversight of the CFTC. “ Digital Asset Market ”—A “Brokered Market,” “Dealer Market,” “Principal-to-Principal Market” or “Exchange Market” (referred to as “Trading Platform Market” in this Annual Report), as each such term is defined in the Financial Accounting Standards Board Accounting Standards Codification Master Glossary. “ Digital Asset Trading Platform ”—An electronic marketplace where trading platform participants may trade, buy and sell Ether based on bid-ask trading. The largest Digital Asset Trading Platforms are online and typically trade on a 24-hour basis, publishing transaction price and volume data. “ Digital Asset Trading Platform Market ”—The global trading platform market for the trading of Ether, which consists of transactions on electronic Digital Asset Trading Platforms. “ Distribution Date ”—July 23, 2024, the distribution date of the shares of the ETH Trust to the Trust’s shareholders in the Initial Distribution. “ DSTA ”—The Delaware Statutory Trust Act, as amended. “ DTC ”—The Depository Trust Company. DTC is a limited purpose trust company organized under New York law, a member of the U.S. Federal Reserve System and a clearing agency registered with the SEC. DTC will act as the securities depository for the Shares. “ ERISA ”—The Employee Retirement Income Security Act of 1974, as amended. “ ETC ” or “ Ethereum Classic ”—Ether Classic tokens, which are a type of digital asset based on an open-source cryptographic protocol existing on the Ethereum Classic network. “ Ether ”—Ethereum tokens, which are a type of digital asset based on an open-source cryptographic protocol existing on the Ethereum Network, comprising units that constitute the assets underlying the Trust’s Shares. “ Ethereum Classic Network ”—The online, end-user-to-end-user network hosting a public transaction ledger, known as the Ethereum Classic blockchain, and the source code comprising the basis for the cryptographic and algorithmic protocols governing the Ethereum Classic network. “ Ethereum Network ”—The online, end-user-to-end-user network hosting the public transaction ledger, known as the Blockchain, and the source code comprising the basis for the cryptographic and algorithmic protocols governing the Ethereum Network. See “Item 1. Business—Overview of the Ethereum Industry and Market.” “ ETH Trust ”—Grayscale Ethereum Mini Trust ETF. “ Excess Creation Cash ”—In connection with a creation pursuant to an Actual Execution Cash Order, the amount of excess cash to be returned to the Authorized Participant in the event the price realized in acquiring the corresponding Total Basket Amount is lower than the Total Basket NAV on the trade date. “ Exchange Act ”—The Securities Exchange Act of 1934, as amended. “ FDIC ”—The Federal Deposit Insurance Corporation. “ FinCEN ”—The Financial Crimes Enforcement Network, a bureau of the U.S. Department of the Treasury. “ FINRA ”—The Financial Industry Regulatory Authority, Inc., which is the primary regulator in the United States for broker-dealers, including Authorized Participants. “ FSMA ”—The Financial Services and Markets Act 2023. “ FTX ”—FTX Trading Ltd. “ Genesis ”—Genesis Global Trading, Inc., a wholly owned subsidiary of Digital Currency Group, Inc. 117 “ Grayscale Securities ”—Grayscale Securities, LLC, a wholly owned subsidiary of GSI until December 31, 2024, and GSO thereafter, which served as the Authorized Participant from October 3, 2022 through July 22, 2024. “ GSI ”—Grayscale Investments, LLC, the Sponsor of the Trust until December 31, 2024. “ GSIS ”—Grayscale Investments Sponsors, LLC, a Delaware limited liability company, the Sponsor of the Trust from and after January 1, 2025, and a wholly owned direct subsidiary of Grayscale Operating, LLC. “ GSO ”—Grayscale Operating, LLC, a Delaware limited liability company and a wholly owned indirect subsidiary of Digital Currency Group, Inc. “ GSOIH ”—GSO Intermediate Holdings Corporation, a Delaware corporation formed in connection with the Reorganization which is the sole managing member of GSO, and an indirect subsidiary of DCG. “ ICE ”—Intercontinental Exchange. “ Incidental Rights ”—Rights to acquire, or otherwise establish dominion and control over, any virtual currency or other asset or right, which rights are incident to the Trust’s ownership of Ether and arise without any action of the Trust, or of the Sponsor or Trustee on behalf of the Trust. “ Index ”—The CoinDesk Ether Price Index (ETX). “ Index License Agreement ”—The license agreement, dated as of February 1, 2022, between the Index Provider and the Sponsor governing the Sponsor’s use of the Index for calculation of the Index Price, as amended from time to time. “ Index Price ”—The U.S. dollar value of an Ether token derived from the Digital Asset Trading Platforms that are reflected in the Index, calculated at 4:00 p.m., New York time, on each business day. See “Item 1. Business—Overview of the Ethereum Industry and Market—Ether Value—The Index and the Index Price” for a description of how the Index Price is calculated. For purposes of the Trust Agreement, the term Ether Index Price shall mean the Index Price as defined herein. “ Index Provider ”—CoinDesk Indices, Inc., a Delaware corporation that publishes the Index. “ In-Kind Order ”—An order for the creation or redemption of Shares pursuant to which the Authorized Participant (or its AP Designee) will deliver or receive Ether directly from the Trust’s Vault Balance. Because In-Kind Regulatory Approval has not been obtained, at this time Shares will not be created or redeemed through In-Kind Orders. “ In-Kind Regulatory Approval ”—The necessary regulatory approval to permit NYSE Arca to list the Shares of the Trust utilizing a structure that allows the Trust to create and redeem Shares via in-kind transactions with Authorized Participants or their AP Designees in exchange for Ether. In common with other spot digital asset exchange-traded products, the Trust is not at this time able to create and redeem shares via in-kind transactions with Authorized Participants, and there has yet to be definitive regulatory guidance on whether and how registered broker-dealers can hold and deal in Ether in compliance with the federal securities laws. To the extent further regulatory clarity emerges, the Sponsor expects NYSE Arca to seek the necessary regulatory approval to amend its listing rules to permit the Trust to create and redeem Shares through In-Kind Orders. There can be no assurance as to when such regulatory clarity will emerge, or when NYSE Arca will seek or obtain such regulatory approval, if at all. “ Initial Distribution ”—The contribution by the Trust of 292,262.98913350 Ether to the ETH Trust, in exchange for 310,158,500 newly created shares of the ETH Trust, which were distributed on the Distribution Date to the Trust’s shareholders as of the Record Date, pro rata based on a 1:1 ratio. “ Investment Advisers Act ”—Investment Advisers Act of 1940, as amended. “ Investment Company Act ”—Investment Company Act of 1940, as amended. “ Investor ”—Any investor that has entered into a subscription agreement with an Authorized Participant, pursuant to which such Authorized Participant will act as agent for the investor. “ IRAs ”—Individual retirement accounts. 118 “ IR Virtual Currency ”—Any virtual currency tokens, or other asset or right, acquired by the Trust through the exercise (subject to the applicable provisions of the Trust Agreement) of any Incidental Right. “ IRS ”—The U.S. Internal Revenue Service, a bureau of the U.S. Department of the Treasury. “ ISG ”—The Intermarket Surveillance Group. “ KYC ”—Know-your-customer. “ Layer 1 ”—The underlying smart contract platform blockchain on which Ethereum functions. “ Layer 2 ”—Protocols built on top of an underlying smart contract platform blockchain intended to provide scalability to the underlying blockchain by increasing transaction efficiency. “ Liquidity Engager ”—Until December 31, 2024, Grayscale Investments, LLC, and on or after January 1, 2025, Grayscale Investments Sponsors, LLC, in each case acting other than in its capacity as Sponsor, and in its capacity to engage one or more Liquidity Providers. “ Liquidity Provider ”—One or more eligible companies that facilitate the purchase and sale of Ether in connection with creations or redemptions pursuant to Cash Orders. The Liquidity Providers with which Grayscale Investments Sponsors, LLC, acting in its capacity as the Liquidity Engager, will engage in Ether transactions are third parties that are not affiliated with the Sponsor or the Trust and are not acting as agents of the Trust, the Sponsor, or any Authorized Participant, and all transactions will be done on an arms-length basis. Except for the contractual relationships between each Liquidity Provider and Grayscale Investments Sponsors, LLC in its capacity as the Liquidity Engager, there is no contractual relationship between each Liquidity Provider and the Trust, the Sponsor, or any Authorized Participant. “ Marketing Agent ”—Foreside Fund Services, LLC. “ Marketing Agent Agreement ”—An agreement entered into by the Sponsor, on behalf of the Trust, dated May 14, 2024, with Foreside Fund Services, LLC. “ Marketing Fee ”—Fee payable to the marketer for services it provides to the Trust, which the Sponsor will pay to the marketer as a Sponsor-paid Expense. “ Merge ”—The Ethereum Network, which was initially known as “Ethereum 2.0.” and was completed on September 15, 2022. “ Merger ”—The merger of Grayscale Investments, LLC with and into Grayscale Operating, LLC, with Grayscale Operating, LLC continuing as the surviving company. “ MiCA ”—The Markets in Crypto-Assets Regulation, which was approved by the Parliament of the European Union in 2023. “ MSB ”—A money services business. “ NAV ”—The aggregate value, expressed in U.S. dollars, of the Trust’s assets (other than U.S. dollars or other fiat currency), less its liabilities (which include estimated accrued but unpaid fees and expenses), a non-GAAP metric, calculated in the manner set forth under “Item 1. Business—Valuation of Ether and Determination of NAV.” See also “Item 1. Business—Investment Objective” for a description of the Trust’s Principal Market NAV, as calculated in accordance with U.S. GAAP. Prior to February 23, 2024, NAV was referred to as Digital Asset Holdings. “ NAV Fee Basis Amount ”—The amount on which the Sponsor’s Fee for the Trust is based, as calculated in the manner set forth under “Item 1. Business—Valuation of Ether and Determination of NAV”. “ Non-ERISA Arrangements ”—Government plans, non-U.S. plans and certain church plans, which are not subject to the fiduciary responsibility or prohibited transaction provisions of ERISA or Section 4975 of the Code, but may be subject to similar rules under Similar Laws. “ NYSE Arca ”—NYSE Arca, Inc. 119 “ OTCQX ”—The OTCQX Best Market ® of OTC Markets Group Inc. “ Participant Agreement ”—An agreement entered into by an Authorized Participant with the Sponsor and the Transfer Agent, that provides the procedures for the creation and redemption of Baskets via a Liquidity Provider. “ Plan Asset Regulations ”—The Department of Labor’s regulations at section 2510.3-101, as amended by Section 3(42) of ERISA. “ Plans ”—Employee benefit plans and certain other plans and arrangements, including IRAs and annuities, Keogh plans, and certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to ERISA and/or the Section 4975 of the Code. “ Pre-Creation/Redemption Abandonment ”—The abandonment by the Trust, irrevocably for no direct or indirect consideration, all Incidental Rights and IR Virtual Currency to which the Trust would otherwise be entitled, effective immediately prior to a Creation Time or a Redemption Time (as the case may be) for the Trust. “ Pre-Creation/Redemption Abandonment Notices ”—A notice, as amended or supplemented from time to time, delivered by the Sponsor to each of the Prime Broker, the Custodian and Coinbase Credit, on behalf of the Trust, stating that the Trust will abandon, irrevocably and for no direct or indirect consideration, effective immediately prior to each Creation Time and each Redemption Time for the Trust, all Incidental Rights and IR Virtual Currency to which it would otherwise be entitled as of such time and with respect to which the Trust has not taken any Affirmative Action at or prior to such time. “ Prime Broker ”—Coinbase, Inc. “ Prime Broker Agreement ”—The Prime Broker Agreement, dated as of May 22, 2024, by and among the Trust, the Sponsor and the Prime Broker, on behalf of itself, the Custodian and Coinbase Credit, that governs the Trust’s and the Sponsor’s use of the Custodial and Prime Broker Services provided by the Custodian and the Prime Broker. “ Principal Market NAV ”—The net asset value of the Trust determined on a U.S. GAAP basis. Prior to February 23, 2024, Principal Market NAV was referred to as NAV. “ Record Date ”—July 18, 2024, the record date for the Initial Distribution. “ Redemption Cash Shortfall ”—In connection with a redemption pursuant to an Actual Execution Cash Order, the amount by which the cash to be delivered to the Authorized Participant is reduced in the event the price realized in disposing the corresponding Total Basket Amount is lower than the Total Basket NAV on the trade date. “ Redemption Time ”—With respect to the redemption of any Shares by the Trust, the time at which the Trust redeems such Shares. “ Reorganization ”—The internal corporate reorganization of Grayscale Investments, LLC consummated on January 1, 2025. “ Required Redemption Cash ”—The actual proceeds to the Trust from the liquidation of the Total Basket Amount. “ SEC ”—The U.S. Securities and Exchange Commission. “ Secondary Index ”—The Coin Metrics Real-Time Rate. “ Secondary Index Price ”—The price set by Coin Metrics Real-Time Rate as of 4:00 p.m., New York time, on the valuation date. See “Item 1. Business—Overview of the Ethereum Industry and Market—Ether Value—The Index and the Index Price—Determination of the Index Price When Index Price is Unavailable” for a description of how the Secondary Index Price is utilized when the Index Price is unavailable. “ Secondary Index Provider ”—Coin Metrics Inc., a Delaware corporation that publishes the Secondary Index. “ Secondary Market ”—Any marketplace or other alternative trading system, as determined by the Sponsor, on which the Shares may then be listed, quoted or traded, including but not limited to, NYSE Arca and the OTCQX Best Market ® of OTC Markets Group Inc. 120 “ Securities Act ”—The Securities Act of 1933, as amended. “ Settlement Balance ”—An account controlled and maintained by the Custodian to which cash and digital assets of the Trust are credited on the Trust’s behalf. “ Shares ”—Common units of fractional undivided beneficial interest in, and ownership of, the Trust. “ Share Percentage ”—A fraction the numerator of which is the number of Shares disposed of and the denominator of which is the total number of Shares held by such U.S. Holder immediately prior to such sale or other disposition. “ Share Split ”—A 9-for-1 Share split of the Trust’s issued and outstanding Shares, which was effected on December 17, 2020 to shareholders of record as of the close of business on December 14, 2020. “ Similar Laws ”—Rules under other federal, state, local, non-U.S. or other applicable law that are similar to ERISA or Section 4975 of the Code. “ SIPC ”—The Securities Investor Protection Corporation. “ Sponsor ” or “ Co-Sponsor ”—The sponsor of the Trust. Grayscale Investments, LLC was the sponsor of the Trust before January 1, 2025, Grayscale Operating, LLC is a co-sponsor of the Trust from January 1, 2025 to May 3, 2025, and Grayscale Investments Sponsors, LLC is a co-sponsor of the Trust from January 1, 2025 to May 3, 2025 and will be the sole remaining sponsor thereafter. “ Sponsor Contracts ”—Certain contracts assigned by GSO pertaining to its role as Sponsor (as such term is defined in the Trust Agreement) of the Trust to GSIS in connection with the Reorganization. “ Sponsor-paid Expenses ”—The fees and expenses incurred by the Trust in the ordinary course of its affairs that the Sponsor is obligated to assume and pay, excluding taxes, but including: (i) the Marketing Fee, (ii) the Administrator Fee, (iii) the Custodian Fee and fees for any other security vendor engaged by the Trust, (iv) the Transfer Agent fee, (v) the Trustee fee, (vi) the fees and expenses related to the listing, quotation or trading of the Shares on any Secondary Market (including customary legal, marketing and audit fees and expenses) in an amount up to $600,000 in any given fiscal year, (vii) ordinary course, legal fees and expenses, (viii) audit fees, (ix) regulatory fees, including, if applicable, any fees relating to the registration of the Shares under the Securities Act or the Exchange Act, (x) printing and mailing costs, (xi) costs of maintaining the Trust’s website and (xii) applicable license fees, provided that any expense that qualifies as an Additional Trust Expense will be deemed to be an Additional Trust Expense and not a Sponsor-paid Expense. “ Sponsor’s Fee ”—A fee, payable in Ether, which accrues daily in U.S. dollars at an annual rate of 2.5% of the NAV Fee Basis Amount of the Trust as of 4:00 p.m., New York time, on each day; provided that for a day that is not a business day, the calculation of the Sponsor’s Fee will be based on the NAV Fee Basis Amount from the most recent business day, reduced by the accrued and unpaid Sponsor’s Fee for such most recent business day and for each day after such most recent business day and prior to the relevant calculation date. “ Staking ”—Using Ether, or permitting Ether to be used, directly or indirectly, through an agent or otherwise, in the Ethereum Network’s proof-of-stake validation protocol, in exchange for the receipt of consideration, including, but not limited to, staking rewards paid in fiat currency or paid in kind. “ Tertiary Pricing Option ”—The price set by the Trust’s principal market. “ Total Basket Amount ”—With respect to any creation or redemption order, the applicable Basket Amount multiplied by the number of Baskets being created or redeemed. “ Total Basket NAV ”—The applicable Basket NAV Amount multiplied by the number of Baskets being created or redeemed. “ Transfer Agency and Service Agreement ”—The agreement between the Sponsor and the Transfer Agent which sets forth the obligations and responsibilities of the Transfer Agent with respect to transfer agency services and related matters. “ Transfer Agent ”—The Bank of New York Mellon, a New York corporation authorized to conduct banking business. “ Transfer Agent Fee ”—Fee payable to the Transfer Agent for services it provides to the Trust, which the Sponsor will pay to the Transfer Agent as a Sponsor-paid Expense. 121 “ Treasury Regulations ”—The regulations, including proposed or temporary regulations, promulgated under the Code. “ Trust ”—Grayscale Ethereum Trust ETF, a Delaware statutory trust, formed on December 13, 2017 under the DSTA and pursuant to the Trust Agreement. “ Trust Agreement ”—The Second Amended and Restated Declaration of Trust and Trust Agreement, dated as of June 12, 2024, between the Trustee and the Sponsor establishing and governing the operations of the Trust, as amended by Amendment No. 1 thereto and as the same may be further amended from time to time. “ Trustee ”—CSC Delaware Trust Company (formerly known as Delaware Trust Company), a Delaware trust company, is the Delaware trustee of the Trust. “ UBTI ”—Unrelated business taxable income. “ Uplisting Date ”—July 23, 2024, the date on which the shares of Grayscale Ethereum Trust ETF began trading on NYSE Arca as shares of an exchange-traded product. “ U.S. ”—United States. “ U.S. dollar ” or “ $ ”—United States dollar or dollars. “ U.S. GAAP ”—United States generally accepted accounting principles. “ Variable Fee ”—An amount in cash based on the Total Basket NAV, which shall be paid by the Authorized Participant in connection with Variable Fee Cash Orders. The amount may be changed by the Sponsor in its sole discretion at any time. “ Variable Fee Cash Order ”—A Cash Order pursuant to which any price differential between (x) the Total Basket NAV on the trade date and (y) the price realized in acquiring or disposing of the corresponding Total Basket Amount, as the case may be, will be borne solely by the applicable Liquidity Provider. “ Vault Balance ”—A segregated custody account controlled and secured by the Custodian to store private keys, which allow for the transfer of ownership or control of the Trust’s Ether on the Trust’s behalf. 122 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned in the capacities* indicated, thereunto duly authorized. Grayscale Investments Sponsors, LLC, as Sponsor of Grayscale Ethereum Trust ETF By: /s/ Peter Mintzberg Name: Peter Mintzberg Title: Member of the Board of Directors and Chief Executive Officer (Principal Executive Officer)* By: /s/ Edward McGee Name: Edward McGee Title: Member of the Board of Directors and Chief Financial Officer (Principal Financial and Accounting Officer)* By: /s/ Mark Shifke Name: Mark Shifke Title: Chairman of the Board of Directors Director* By: /s/ Matthew Kummell Name: Matthew Kummell Title: Member of the Board of Directors Director* Date: February 27, 2025 * The Registrant is a trust and the persons are signing in their capacities as officers of Grayscale Operating, LLC, the sole member of Grayscale Investments Sponsors, LLC, the Sponsor of the Registrant, or directors of GSO Intermediate Holdings Corporation, the sole managing member of Grayscale Operating, LLC, as applicable. 123 INDEX TO FINANCIAL STATEMENTS Page Grayscale Ethereum Trust ETF Annual Financial Statements Reports of Independent Registered Public Accounting Firms (KPMG LLP, PCAOB ID 185; Marcum LLP, PCAOB ID 688 ) F- 2 Statements of Assets and Liabilities at December 31, 2024 and 2023 F- 6 Schedules of Investment at December 31, 2024 and 2023 F- 7 Statements of Operations for the Years Ended December 31, 2024, 2023 and 2022 F- 8 Statements of Changes in Net Assets for the Years Ended December 31, 2024, 2023 and 2022 F- 9 Statement of Cash Flows for the Year Ended December 31, 2024 F- 10 Notes to Financial Statements F- 11 F- 1 REPORT OF INDEPENDENT REGIS TERED PUBLIC ACCOUNTING FIRM To the Shareholders and Sponsor of Grayscale Ethereum Trust ETF: Opinion on the Financial Statements We have audited the accompanying statement of assets and liabilities, including the schedule of investment of Grayscale Ethereum Trust ETF (the Trust) as of December 31, 2024, and the related statements of operations, changes in net assets, and cash flows for the year then ended, and the related notes (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2024, and the results of its operations, changes in its net assets, and its cash flows for the year then ended, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Trust’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 27, 2025 expressed an unqualified opinion on the effectiveness of the Trust’s internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Trust’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Evaluation of the existence and rights over the investment in Ether As discussed in Notes 2 and 3 to the financial statements, the Trust accounts for its investment in Ether at fair value in accordance with its classification as an investment company for accounting purposes. As of December 31, 2024, the fair value of the Trust’s investment in Ether was $4.7 billion, with a respective cost basis of $0.6 billion. We identified the evaluation of the existence of and the Trust’s rights to Ether, including the risk that the Trust’s investment in Ether may not be owned by the Trust, as a critical audit matter. A high degree of auditor judgment was involved in determining the nature and extent of the procedures performed and audit evidence obtained to assess the existence of and the Trust’s rights to its investment in Ether, as control and access over the Ether was provided through private cryptographic keys stored using third-party custodial services. In addition, auditor judgement was required to evaluate the sufficiency of audit evidence obtained. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the existence of the Trust’s investment in Ether and the Trust’s rights over its investment in Ether, including controls over the comparison of the Trust’s records of Ether held to the third-party custodial records. We involved information technology professionals with specialized skills and knowledge in blockchain technology, who assisted in evaluating certain internal controls over the safeguarding of digital assets process performed at the third-party custodian, specifically related to the generation of the private cryptographic keys, the storing of these keys, and the reconciliation of digital assets per the custodial service ledgers to the public blockchain. We obtained confirmation of the Trust’s investment in Ether held with the third-party custodian as of December 31, 2024 and compared the results of the confirmation to the Trust’s record of its investment in Ether. We F- 2 compared the Trust’s record for a selection of on blockchain Ether purchase and sale transactions to the records on the public blockchain using a software audit tool. We also obtained and assessed evidence that such transactions were appropriately authorized and that the Trust controlled the Ether through the third-party custodian. We evaluated the reliability of audit evidence obtained from the public blockchain. We also assessed the sufficiency of audit evidence obtained by evaluating the cumulative results of the audit procedures. /s/ KPMG LLP We have served as the Trust’s auditor since 2024. New York, New York February 27, 2025 F- 3 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Sponsor of Grayscale Ethereum Trust ETF: Opinion on Internal Control Over Financial Reporting We have audited Grayscale Ethereum Trust ETF's (the Trust) internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Trust maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the statement of assets and liabilities, including the schedule of investment, of the Trust as of December 31, 2024, the related statements of operations, changes in net assets, and cash flows for the year then ended, and the related notes (collectively, the financial statements), and our report dated February 27, 2025 expressed an unqualified opinion on those financial statements. Basis for Opinion The Trust’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Trust’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ KPMG LLP New York, New York February 27, 2025 F- 4 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Sponsor of Grayscale Ethereum Trust ETF Opinion on the Financial Statements We have audited the accompanying statements of assets and liabilities, including the schedule of investment, of Grayscale Ethereum Trust ETF (the “Trust”) as of December 31, 2023, and the related statements of operations and changes in net assets for each of the years in the two-year period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2023, and the results of its operations for each of the years in the two-year period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the management of the Trust’s Sponsor, Grayscale Investments, LLC. Our responsibility is to express an opinion on the Trust’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Marcum LLP We have served as the Trust’s auditor from 2018 to 2024 (such date takes into account the acquisition of certain assets of Friedman LLP by Marcum LLP effective September 1, 2022). New York, New York February 23, 2024 F- 5 GRAYSCALE ETHEREUM TRUST ETF STATEMENTS OF ASSET S AND LIABILITIES ( Amounts in thousands, except Share and per Share amounts) December 31, 2024 2023 Assets: Investment in Ether, at fair value (cost $ 608,668 and $ 1,244,746 as of December 31, 2024 and 2023, respectively) $ 4,735,980 $ 6,758,054 Total assets $ 4,735,980 $ 6,758,054 Liabilities: Sponsor’s Fee payable, related party $ - $ - Total liabilities - - Net assets $ 4,735,980 $ 6,758,054 Shares issued and outstanding, no par value (unlimited Shares authorized) 169,098,500 310,158,500 Principal market net asset value per Share $ 28.01 $ 21.79 See accompanying notes to financial statements. F- 6 GRAYSCALE ETHEREUM TRUST ETF SCHEDULES OF INVESTMENT ( Amounts in thousands, except quantity of Ether and percentages) December 31, 2024 Quantity of Ether Cost Fair Value % of Net Assets Investment in Ether 1,417,788.29257515 $ 608,668 $ 4,735,980 100 % Total Investment $ 608,668 $ 4,735,980 100 % Net assets $ 608,668 $ 4,735,980 100 % December 31, 2023 Quantity of Ether Cost Fair Value % of Net Assets Investment in Ether 2,962,629.50149940 $ 1,244,746 $ 6,758,054 100 % Net assets $ 1,244,746 $ 6,758,054 100 % See accompanying notes to financial statements. F- 7 GRAYSCALE ETHEREUM TRUST ETF STATEMENTS OF OPERATIONS ( Amounts in thousands) Years Ended December 31, 2024 2023 2022 Investment income: Investment income $ - $ - $ - Expenses: Sponsor’s Fee, related party 182,594 134,484 153,242 Net investment loss ( 182,594 ) ( 134,484 ) ( 153,242 ) Net realized and unrealized gain (loss) from: Net realized gain on investment in Ether sold to pay expenses 157,557 102,973 120,933 Net realized gain on investment in Ether sold for redemption of Shares 3,108,025 - - Net realized gain on investment in Ether sold for Initial Distribution (Return of Capital) (1) 888,140 - - Net change in unrealized appreciation on investment in Ether ( 1,385,995 ) 3,140,367 ( 7,670,184 ) Net realized and unrealized gain (loss) on investment 2,767,727 3,243,340 ( 7,549,251 ) Net increase (decrease) in net assets resulting from operations $ 2,585,133 $ 3,108,856 $ ( 7,702,493 ) (1) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $ 1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4. See accompanying notes to financial statements. F- 8 GRAYSCALE ETHEREUM TRUST ETF STATEMENTS OF CHANG ES IN NET ASSETS ( Amounts in thousands, except change in Shares outstanding) Years Ended December 31, 2024 2023 2022 Increase (decrease) in net assets from operations: Net investment loss $ ( 182,594 ) $ ( 134,484 ) $ ( 153,242 ) Net realized gain on investment in Ether sold to pay expenses 157,557 102,973 120,933 Net realized gain on investment in Ether sold for redemption of Shares 3,108,025 - - Net realized gain on investment in Ether sold for Initial Distribution (Return of Capital) (1) 888,140 - - Net change in unrealized appreciation on investment in Ether ( 1,385,995 ) 3,140,367 ( 7,670,184 ) Net increase (decrease) in net assets resulting from operations 2,585,133 3,108,856 ( 7,702,493 ) Decrease in net assets from capital share transactions: Shares issued 14,886 - - Shares redeemed ( 3,611,158 ) - - Return of Capital (1) ( 1,010,935 ) - - Net decrease in net assets resulting from capital share transactions ( 4,607,207 ) - - Total (decrease) increase in net assets from operations and capital share transactions ( 2,022,074 ) 3,108,856 ( 7,702,493 ) Net assets: Beginning of year 6,758,054 3,649,198 11,351,691 End of year $ 4,735,980 $ 6,758,054 $ 3,649,198 Change in Shares outstanding: Shares outstanding at beginning of year 310,158,500 310,158,500 310,158,500 Shares issued 480,000 - - Shares redeemed ( 141,540,000 ) - - Net decrease in Shares ( 141,060,000 ) - - Shares outstanding at end of year 169,098,500 310,158,500 310,158,500 (1) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $ 1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4. See accompanying notes to financial statements. F- 9 GRAYSCALE ETHEREUM TRUST ETF STATEMENT OF CASH FLOWS ( Amounts in thousands) Year Ended December 31, 2024 (1) Cash provided by operating activities Net increase in net assets resulting from operations $ 2,585,133 Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities: Purchases of Ether (2) $ ( 14,742 ) Proceeds from Ether sold to pay redemptions (2) 3,649,316 Proceeds from Ether sold to pay expenses 182,594 Net realized (gain) loss ( 4,153,722 ) Net decrease in unrealized appreciation on investment in Ether 1,385,995 Change in operating assets and liabilities: Sponsor’s Fee payable - Net cash provided by operating activities $ 3,634,574 Cash used in financing activities Proceeds from issuance of capital shares (2) $ 14,742 Payments for capital shares redeemed (2) ( 3,649,316 ) Net cash used in financing activities $ ( 3,634,574 ) Cash Net increase (decrease) in cash $ - Cash, beginning of year - Cash, end of year $ - Supplemental disclosure of noncash operating activities Transfer of Ether to pay for Sponsor’s Fee $ 182,594 Supplemental disclosure of noncash financing activities Transfer of Ether used for Initial Distribution (Return of Capital) (3) $ 1,010,935 (1) No comparative financial statements have been provided, as the Trust did not hold any cash or cash equivalents prior to the Uplisting Date. (2) The proceeds collected by an Authorized Participant from the sale of Shares and the payments for Shares redeemed by an Authorized Participant do not correlate with the amounts in the Statement of Operations and the Statement of Changes in Net Assets for the period due to creations and redemptions occurring at the Index Price as defined in the Trust Agreement. (3) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $ 1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4. See accompanying notes to financial statements. F- 10 GRAYSCALE ETHEREUM TRUST ETF NOTES TO THE FINA NCIAL STATEMENTS 1. Organization Grayscale Ethereum Trust ETF (the “Trust”) is a Delaware Statutory Trust that was formed on December 13, 2017 and commenced operations on December 14, 2017. In general, the Trust holds Ethereum tokens (“Ether”) and, from time to time, issues common units of fractional undivided beneficial interest (“Shares”) in exchange for Ether. Prior to July 23, 2024, the Trust did not operate a redemption program. On May 23, 2024, the Securities and Exchange Commission (the “SEC”) approved an application under Rule 19b-4 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) by NYSE Arca, Inc. (“NYSE Arca”) to list the Shares of the Trust, which began trading on NYSE Arca on July 23, 2024 (the “Uplisting Date”), following the effectiveness of the Trust’s registration statement on Form S-3, as amended (File No. 333-278880). As of the date of this Annual Report, the Trust is an SEC reporting company with its Shares registered pursuant to Section 12(b) of the Exchange Act. On July 22, 2024, in connection with the approval of the 19b-4 Application on May 23, 2024 and the effectiveness of the registration statement on Form S-3, as amended, the Sponsor authorized the commencement of a redemption program. Effective July 23, 2024, 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. The creation of a Basket requires the delivery to the Trust of the amount of Ether (or cash to acquire such amount 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 amount 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 Trust’s investment objective is for the value of the Shares (based on Ether per Share) to reflect the value of Ether held by the Trust, less the Trust’s expenses and other liabilities. The Trust may also receive Incidental Rights and/or IR Virtual Currency as a result of the Trust’s investment in Ether, in accordance with the terms of the Trust Agreement. Incidental Rights are rights to claim, or otherwise establish dominion and control over, any virtual currency or other asset or right, which rights are incident to the Trust’s ownership of Ether and arise without any action of the Trust, or of the Sponsor or Trustee on behalf of the Trust; IR Virtual Currency is any virtual currency tokens, or other asset or right, received by the Trust through the exercise (subject to the applicable provisions of the Trust Agreement) of any Incidental Right. On July 29, 2019, the Sponsor delivered to the Custodian (as defined below), on behalf of the Trust, a notice stating that the Trust is abandoning irrevocably for no direct or indirect consideration, effective immediately prior to each time at which the Trust creates Shares, all Incidental Rights and IR Virtual Currency to which it would otherwise be entitled as of such time. On May 23, 2024, the Trust delivered a supplemental notice to the Prime Broker, the Custodian and Coinbase Credit, Inc. providing that the Trust also will abandon irrevocably for no direct or indirect consideration, effective immediately prior to each time at which the Trust redeems Shares, all Incidental Rights or IR Virtual Currency to which it would otherwise be entitled as of such time. The Sponsor has committed to cause the Trust not to take any Affirmative Action to acquire any Incidental Rights or IR Virtual Currency, thereby irrevocably abandoning any Incidental Rights and IR Virtual Currency to which the Trust may become entitled in the future. Because the Sponsor has now committed to causing the Trust to irrevocably abandon all Incidental Rights and IR Virtual Currency to which the Trust otherwise would become entitled in the future, and causing the Trust not to take any Affirmative Actions, the Trust will not receive any direct or indirect consideration for the Incidental Rights or IR Virtual Currency and thus the value of the Shares will not reflect the value of the Incidental Rights or IR Virtual Currency. In addition, in the event the Sponsor seeks to change the Trust’s policy with respect to Incidental Rights or IR Virtual Currency, an application would need to be filed with the SEC by NYSE Arca seeking approval to amend its listing rules to permit the Trust to distribute the Incidental Rights or IR Virtual Currency in kind to an agent of the shareholders for resale by such agent. As of December 31, 2024, Grayscale Investments, LLC (“Grayscale” or the “Sponsor”) acted as the Sponsor of the Trust and was a wholly owned subsidiary of Digital Currency Group, Inc. (“DCG”). The Sponsor is responsible for the day-to-day administration of the Trust pursuant to the provisions of the Trust Agreement. Grayscale is responsible for preparing and providing annual and quarterly reports on behalf of the Trust to investors and is also responsible for selecting and monitoring the Trust’s service providers. As partial consideration for the Sponsor’s services, the Trust pays Grayscale a Sponsor’s Fee as discussed in Note 7. The Sponsor also acts as the sponsor and manager of other investment products including Grayscale Aave Trust (AAVE), Grayscale Avalanche Trust (AVAX), Grayscale Basic Attention Token Trust (BAT) (OTCQX: GBAT), Grayscale Bitcoin Trust ETF (NYSE Arca: GBTC), Grayscale Bitcoin Cash Trust (BCH) (OTCQX: BCHG), Grayscale Bitcoin Mini Trust ETF (NYSE Arca: BTC), Grayscale Bittensor Trust (TAO), Grayscale Chainlink Trust (LINK) (OTCQX: GLNK), Grayscale Decentraland Trust (MANA) (OTCQX: MANA), Grayscale Dogecoin Trust (DOGE), Grayscale Ethereum Classic Trust (ETC) (OTCQX: ETCG), Grayscale Ethereum Mini Trust ETF (NYSE Arca: ETH), Grayscale Filecoin Trust (FIL) (OTC Markets: FILG), Grayscale Horizen Trust (ZEN) (OTCQX: HZEN), Grayscale Lido DAO Trust (LDO), Grayscale Litecoin Trust (LTC) (OTCQX: LTCN), Grayscale Livepeer Trust (LPT) (OTCQX: GLIV), Grayscale MakerDao Trust (MKR), Grayscale NEAR Trust (NEAR), Grayscale Optimism Trust (OP), Grayscale Pyth Trust (PYTH), Grayscale Solana Trust (SOL) (OTCQX: GSOL), Grayscale Stacks Trust (STX), Grayscale Stellar Lumens Trust (XLM) (OTCQX: GXLM), Grayscale Sui Trust (SUI), Grayscale XRP Trust, Grayscale Zcash Trust (ZEC) (OTCQX: ZCSH), Grayscale Decentralized AI Fund LLC, Grayscale Decentralized Finance (DeFi) Fund LLC (OTCQB: DEFG), Grayscale Digital Large Cap Fund LLC (OTCQX: GDLC), and Grayscale Smart Contract Platform Ex Ethereum (ETH) Fund LLC, each of which is an affiliate of the Trust. The following investment products sponsored or managed by the Sponsor are SEC reporting companies with their shares registered pursuant to Section 12(g) of the F- 11 Securities Exchange Act of 1934, as amended (the “Exchange Act”): Grayscale Bitcoin Cash Trust (BCH), Grayscale Ethereum Classic Trust (ETC), Grayscale Horizen Trust (ZEN), Grayscale Litecoin Trust (LTC), Grayscale Stellar Lumens Trust (XLM), Grayscale Zcash Trust (ZEC), and Grayscale Digital Large Cap Fund LLC. Prior to July 23, 2024, shares of the Trust were also registered pursuant to Section 12(g) of the Exchange Act. The following investment products sponsored by the Sponsor are also SEC reporting companies with their shares registered pursuant to Section 12(b) of the Exchange Act: Grayscale Bitcoin Trust ETF, Grayscale Ethereum Mini Trust ETF, and Grayscale Bitcoin Mini Trust ETF. Authorized Participants of the Trust are the only entities who may place orders to create or redeem Baskets. Grayscale Securities, LLC (“Grayscale Securities” or, in such capacity, an “Authorized Participant”), a registered broker-dealer and affiliate of the Sponsor, was the only Authorized Participant from October 3, 2022 through July 22, 2024. On or after July 22, 2024, the Sponsor, on behalf of the Trust, and the Transfer Agent entered into Participant Agreements with a number of unaffiliated Authorized Participants in connection with the approval of NYSE Arca’s application under Rule 19b-4 of the Exchange Act, and the Trust has also since engaged other Authorized Participants. In connection with the entry into the Participant Agreements, as of July 22, 2024, the Sponsor amended, solely, with respect to the Trust, the Participant Agreement, dated as of October 3, 2022, between the Sponsor and Grayscale Securities, to remove the Trust as an entity covered by the Agreement. Effective July 22, 2024, Grayscale Securities no longer serves as Authorized Participant of the Trust. Additional Authorized Participants may be added at any time, subject to the discretion of the Sponsor. Liquidity Providers facilitate the purchase and sale of Ether in connection with cash orders for creations or redemptions of Baskets. The Liquidity Providers with which Grayscale Investments Sponsors, LLC, acting in its capacity as the “Liquidity Engager,” will engage in Ether transactions are third parties that are not affiliated with the Sponsor or the Trust and are not acting as agents of the Trust, the Sponsor, or any Authorized Participant, and all transactions will be done on an arms-length basis. Except for the contractual relationships between each Liquidity Provider and Grayscale Investments Sponsors, LLC in its capacity as the Liquidity Engager, there is no contractual relationship between each Liquidity Provider and the Trust, the Sponsor, or any Authorized Participant. The Liquidity Engager may engage additional Liquidity Providers who are unaffiliated with the Trust in the future. Effective July 23, 2024, the Trust, the Sponsor and Coinbase, Inc., the prime broker of the Trust (“Coinbase” or the “Prime Broker”), on behalf of itself and as agent for Coinbase Custody Trust Company, LLC (“Coinbase Custody” or the “Custodian”) and Coinbase Credit, Inc. (“Coinbase Credit” and, collectively with Coinbase and Coinbase Custody, the “Coinbase Entities”), entered into the Coinbase Prime Broker Agreement governing the Trust’s and the Sponsor’s use of the Custodial and Prime Broker Services provided by the Custodian and the Prime Broker. The Prime Broker Agreement establishes the rights and responsibilities of the Custodian, the Prime Broker, the Sponsor and the Trust with respect to the Trust’s Ether which is held in accounts maintained and operated by the Custodian, as a fiduciary with respect to the Trust’s assets, and the Prime Broker (together with the Custodian, the “Custodial Entities”) on behalf of the Trust. The Custodian is responsible for safeguarding the Ether held by the Trust, and holding the private key(s) that provide access to the Trust’s digital wallets and vaults. Effective July 23, 2024, the transfer agent for the Trust (the “Transfer Agent”) is The Bank of New York Mellon. The responsibilities of the Transfer Agent are to (1) facilitate the issuance and redemption of shares of the Trust; (2) respond to correspondence by Trust shareholders and others relating to its duties; (3) maintain shareholder accounts; and (4) make periodic reports to the Trust. Effective July 23, 2024, the co-transfer agent for the Trust (the “Co-Transfer Agent”) is Continental Stock Transfer & Trust Company. The administrator for the Trust (the “Administrator”) is BNY Mellon Asset Servicing, a division of The Bank of New York Mellon. BNY Mellon Asset Servicing provides administration and accounting services to the Trust. The Administrator’s fees are paid on behalf of the Trust by the Sponsor. The marketing agent for the Trust (the “Marketing Agent”) is Foreside Fund Services, LLC. Effective July 22, 2024, the Marketing Agent provides the following services to the Sponsor: (i) assist the Sponsor in facilitating Participation Agreements between and among Authorized Participants, the Sponsor, on behalf of the Trust, and the Transfer Agent; (ii) provide prospectuses to Authorized Participants; (iii) work with the Transfer Agent to review and approve orders placed by the Authorized Participants and transmitted to the Transfer Agent; (iv) review and file applicable marketing materials with FINRA and (v) maintain, reproduce and store applicable books and records. On May 23, 2019, the Trust received notice that its Shares were qualified for public trading on the OTCQX Best Market ® (“OTCQX”) of OTC Markets Group Inc. Until July 22, 2024, the Trust’s trading symbol on OTCQX was “ETHE.” On May 23, 2024, the SEC approved an application under Rule 19b-4 of the Exchange Act by NYSE Arca to list the Shares of the Trust. Shares of the Trust began trading on NYSE Arca on July 23, 2024, following the effectiveness of the Trust’s registration statement on Form S-3, as amended (File No. 333-278880). The Trust’s trading symbol on NYSE Arca is “ETHE” and the CUSIP number for its Shares is 389638107 . F- 12 2. Summary of Significant Accounting Policies The following is a summary of significant accounting policies followed by the Trust: The financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The Trust qualifies as an investment company for accounting purposes pursuant to the accounting and reporting guidance under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services—Investment Companies . The Trust uses fair value as its method of accounting for Ether in accordance with its classification as an investment company for accounting purposes. The Trust is not a registered investment company under the Investment Company Act of 1940. U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates and these differences could be material. The Trust conducts its transactions in Ether, including receiving Ether for the creation of Shares and delivering Ether for the redemption of Shares and for the payment of the Sponsor’s Fee. For financial reporting purposes, unless otherwise disclosed herein, the Trust’s transactions are valued in accordance with the Trust’s principal market policy described below. Cash and Cash Equivalents Generally, the Trust does not intend to hold cash, except in connection with cash orders for creations or redemptions of Baskets. Cash includes non-interest bearing non-restricted cash with one institution. Cash in a bank deposit account, at times, may exceed U.S. federally insured limits. The Trust has not experienced any losses in such accounts and does not believe it is exposed to any significant credit risk on such bank deposits. Principal Market and Fair Value Determination To determine which market is the Trust’s principal market (or in the absence of a principal market, the most advantageous market) for purposes of calculating the Trust’s net asset value in accordance with U.S. GAAP (“Principal Market NAV”), the Trust follows ASC Topic 820-10, Fair Value Measurement, which outlines the application of fair value accounting. ASC 820-10 determines fair value to be the price that would be received for Ether in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Trust to assume that Ether is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Trust only receives Ether in connection with a creation order from the Authorized Participant (or a Liquidity Provider) and does not itself transact on any Digital Asset Markets. Therefore, the Trust looks to market-based volume and level of activity for Digital Asset Markets. The Authorized Participant(s), or a Liquidity Provider, may transact in a Brokered Market, a Dealer Market, Principal-to-Principal Markets and Exchange Markets (referred to as “Trading Platform Markets” in this Annual Report), each as defined in the FASB ASC Master Glossary (collectively, “Digital Asset Markets”). In determining which of the eligible Digital Asset Markets is the Trust’s principal market, the Trust reviews these criteria in the following order: First, the Trust reviews a list of Digital Asset Markets that maintain practices and policies designed to comply with anti-money laundering (“AML”) and know-your-customer (“KYC”) regulations, and non-Digital Asset Trading Platform Markets that the Trust reasonably believes are operating in compliance with applicable law, including federal and state licensing requirements, based upon information and assurances provided to it by each market. Second, the Trust sorts these Digital Asset Markets from high to low by market-based volume and level of activity of Ether traded on each Digital Asset Market in the trailing twelve months. Third, the Trust then reviews pricing fluctuations and the degree of variances in price on Digital Asset Markets to identify any material notable variances that may impact the volume or price information of a particular Digital Asset Market. Fourth, the Trust then selects a Digital Asset Market as its principal market based on the highest market-based volume, level of activity and price stability in comparison to the other Digital Asset Markets on the list. Based on information reasonably available to the Trust, Trading Platform Markets have the greatest volume and level of activity for the asset. The Trust therefore looks to accessible Trading Platform Markets as opposed to the Brokered Market, Dealer Market and Principal-to-Principal Markets to determine its principal market. As a result of the aforementioned analysis, a Trading Platform Market has been selected as the Trust’s principal market. The Trust determines its principal market (or in the absence of a principal market the most advantageous market) annually and conducts a quarterly analysis to determine (i) if there have been recent changes to each Digital Asset Market’s trading volume and level of activity in the trailing twelve months, (ii) if any Digital Asset Markets have developed that the Trust has access to, or (iii) if recent changes to each Digital Asset Market’s price stability have occurred that would materially impact the selection of the principal market and necessitate a change in the Trust’s determination of its principal market. F- 13 The cost basis of Ether received by the Trust in connection with a creation order is recorded by the Trust at the fair value of Ether at 4:00 p.m., New York time, on the creation date for financial reporting purposes. The cost basis recorded by the Trust may differ from proceeds collected by the Authorized Participant from the sale of the corresponding Shares to investors. Investment Transactions and Revenue Recognition The Trust considers investment transactions to be the receipt of Ether for Share creations and the delivery of Ether for Share redemptions, or for payment of expenses in Ether. The Trust records its investment transactions on a trade date basis and changes in fair value are reflected as net change in unrealized appreciation or depreciation on investments. Realized gains and losses are calculated using the specific identification method. Realized gains and losses are recognized in connection with transactions including settling obligations for the Sponsor’s Fee in Ether. Fair Value Measurement Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the ‘exit price’) in an orderly transaction between market participants at the measurement date. U.S. GAAP utilizes a fair value hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Trust. Unobservable inputs reflect the Trust’s assumptions about the inputs market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy is categorized into three levels based on the inputs as follows: • Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Trust has the ability to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, these valuations do not entail a significant degree of judgment. • Level 2 – Valuations based on quoted prices in markets that are not active or for which significant inputs are observable, either directly or indirectly. • Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The availability of valuation techniques and observable inputs can vary by investment. To the extent that valuations are based on sources that are less observable or unobservable in the market, the determination of fair value requires more judgment. Fair value estimates do not necessarily represent the amounts that may be ultimately realized by the Trust. Fair Value Measurement Using (Amounts in thousands) Amount at Fair Value Level 1 Level 2 Level 3 December 31, 2024 Assets Investment in Ether $ 4,735,980 $ 4,735,980 $ - $ - December 31, 2023 Assets Investment in Ether $ 6,758,054 $ 6,758,054 $ - $ - Recently Adopted Accounting Pronouncements In December 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”). ASU 2023-08 is intended to improve the accounting for certain crypto assets by requiring an entity to measure those crypto assets at fair value each reporting period with changes in fair value recognized in net income. The amendments also improve the information provided to investors about an entity’s crypto asset holdings by requiring disclosure about significant holdings, contractual sale restrictions, and changes during the reporting period. ASU 2023-08 is effective for annual and interim reporting periods beginning after December 15, 2024. Early adoption is permitted for both interim and annual financial statements that have not yet been issued. The Trust adopted this new guidance on January 1, 2024, with no material impact on its financial statements and disclosures as the Trust historically used fair value as its method of accounting for Ether in accordance with its classification as an investment company for accounting purposes. F- 14 In this reporting period, the Trust adopted FASB Accounting Standards Update 2023-07, Segment Reporting (Topic 280)— Improvements to Reportable Segment Disclosures (“ASU 2023-07”). Adoption of the new standard impacted financial statement disclosures only and did not affect the Trust’s financial position or the results of its operations. Operating segments are defined as components of an enterprise that engage in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker (“CODM”) in deciding how to allocate resources and to assess performance. The Chief Executive Officer and Chief Financial Officer of the Sponsor act as the Trust’s CODM. The Trust represents a single operating segment, as the CODM monitors the operating results of the Trust as a whole and the Trust’s passive investment objective is pre-determined in accordance with the terms of the Trust Agreement. The financial information in the form of the Trust’s total returns, expense ratios and changes in net assets (i.e., changes in net assets resulting from operations and capital share transactions), which are used by the CODM to assess the segment’s performance, are consistent with that presented within the Trust’s financial statements. Segment assets are reflected on the accompanying Statements of Assets and Liabilities as Total assets and the only significant segment expense, the Sponsor’s fee, related party, is included in the accompanying Statements of Operations. 3. Fair Value of Ether Ether is held by the Custodian on behalf of the Trust and is carried at fair value. As of December 31, 2024, 2023 and 2022, the Trust held 1,417,788.29257515 , 2,962,629.50149940 and 3,037,631.42522860 Ether, respectively. The Trust determined the fair value per Ether to be $ 3,340.40 on December 31, 2024, using the price provided at 4:00 p.m., New York time, by the Digital Asset Trading Platform Market considered to be the Trust’s principal market (Crypto.com). The Trust determined the fair value per Ether to be $ 2,281.10 and $ 1,201.33 on December 31, 2023 and 2022, respectively, using the price provided at 4:00 p.m., New York time, by the Digital Asset Trading Platform Market considered to be the Trust’s principal market (Coinbase). Historically, the Trust considered Coinbase to be its principal market. The Trust performed an assessment of the principal market at December 31, 2024 and identified a change in the principal market from Coinbase to Crypto.com. The change in principal market was effective December 31, 2024. The following represents the changes in quantity of Ether and the respective fair value: (Amounts in thousands, except Ether amounts) Quantity Fair Value Balance at December 31, 2021 3,114,532.09753906 $ 11,351,691 Ether contributed - - Ether distributed for Sponsor’s Fee, related party ( 76,900.67231046 ) ( 153,242 ) Net change in unrealized appreciation on investment in Ether - ( 7,670,184 ) Net realized gain on investment in Ether - 120,933 Balance at December 31, 2022 3,037,631.42522860 $ 3,649,198 Ether contributed - - Ether distributed for Sponsor’s Fee, related party ( 75,001.92372920 ) ( 134,484 ) Net change in unrealized appreciation on investment in Ether - 3,140,367 Net realized gain on investment in Ether - 102,973 Balance at December 31, 2023 2,962,629.50149940 $ 6,758,054 Ether contributed 4,028.41550052 14,886 Ether redeemed ( 1,197,071.35114039 ) ( 3,611,158 ) Ether distributed for Initial Distribution (Return of Capital) (1) ( 292,262.98913350 ) ( 1,010,935 ) Ether distributed for Sponsor’s Fee, related party ( 59,535.28415088 ) ( 182,594 ) Net change in unrealized appreciation on investment in Ether - ( 1,385,995 ) Net realized gain on investment in Ether sold to pay expenses - 157,557 Net realized gain on investment in Ether sold for redemption of Shares - 3,108,025 Net realized gain on investment in Ether sold for Return of Capital (1) - 888,140 Balance at December 31, 2024 1,417,788.29257515 $ 4,735,980 (1) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $ 1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4. F- 15 4. The Initial Distribution to the Grayscale Ethereum Mini Trust ETF On July 8, 2024, the Sponsor of the Trust issued a press release announcing that the Sponsor, at the direction of its board of directors, declared a pro rata distribution on the Shares of the Trust, pursuant to which each holder of Shares as of 4:00 PM ET on July 18, 2024 (the “Record Date,” and such holders, the “ETHE Record Holders”) was entitled to receive shares (the “ETH Shares”) of Grayscale Ethereum Mini Trust ETF (the “ETH Trust”), a Delaware statutory trust sponsored by the Sponsor, in connection with its previously announced initial creation and distribution of ETH Shares (such transactions collectively, the “Initial Distribution”), as described in a definitive information statement on Schedule 14C filed with the Securities and Exchange Commission on July 18, 2024. In the Initial Distribution, the Trust contributed approximately 10 % of the Ether that it held as of 4:00 PM ET on the Record Date to the ETH Trust, and each ETHE Record Holder was entitled to receive ETH Shares pro rata based on a 1 :1 ratio, such that for each one (1) ETHE Share held by an ETHE Record Holder, such ETHE Record Holder was entitled to receive one (1) ETH Share on the Distribution Date. In connection therewith, on July 23, 2024, the Trust completed its previously announced pro rata distribution of 310,158,500 shares of the ETH Trust to shareholders of the Trust as of 4:00 PM ET on the Record Date and contributed to the ETH Trust an amount of Ether equal to approximately 10 % of the total Ether held by the Trust as of the Record Date, equal to 292,262.98913350 Ether, with a value of $ 1,010,934,757 , as consideration and in exchange for 310,158,500 shares of the ETH Trust at $ 3.26 per share. For the year ended December 31, 2024 , the Trust recognized a gain of $ 888,140,738 in connection with the Initial Distribution, which is included in net realized gain on investment in Ether sold for redemption of Shares on the Statement of Operations. It is expected that neither the Trust nor any beneficial owner of the Shares will recognize any gain or loss for U.S. federal income tax purposes as a result of the Initial Distribution. 5. Creations and Redemptions of Shares At December 31, 2024 and 2023, there were an unlimited number of Shares authorized by the Trust. The Trust creates and redeems Shares from time to time, but only in one or more Baskets. The creation and redemption of Baskets on behalf of investors are made by the Authorized Participant in exchange for the delivery of Ether to the Trust or the distribution of Ether by the Trust. The amount of Ether required for each Creation Basket or Redemption Basket is determined by dividing (x) the amount of Ether owned by the Trust at 4:00 p.m., New York time, on such trade date of a creation or redemption order, after deducting the amount of Ether representing the U.S. dollar value of accrued but unpaid fees and expenses of the Trust, by (y) the number of Shares outstanding at such time and multiplying the quotient obtained by 10,000. Each Share represented approximately 0.0084 and 0.0096 of one Ether at December 31, 2024 and 2023, respectively. The decrease in the amount of Ether represented by each Share is primarily a result of the Initial Distribution and the periodic withdrawal of Ether to pay the Sponsor’s Fee. The cost basis of investments in Ether recorded by the Trust is the fair value of Ether, as determined by the Trust, at 4:00 p.m., New York time, on the date of transfer to the Trust by the Authorized Participant, or Liquidity Provider, based on the Creation Baskets. The cost basis recorded by the Trust may differ from proceeds collected by the Authorized Participant from the sale of each Share to investors. The Authorized Participant, or Liquidity Provider, may realize significant profits buying, selling, creating, and redeeming Shares as a result of changes in the value of Shares or Ether. On October 2, 2023, NYSE Arca filed an application with the SEC pursuant to Rule 19b-4 under the Exchange Act to list the Shares of the Trust on NYSE Arca. On April 23, 2024, the Sponsor filed with the SEC a registration statement on Form S-3, as amended through July 18, 2024, to register the Shares of the Trust under the Securities Act of 1933. On May 23, 2024, the SEC approved NYSE Arca’s 19b-4 application to list the Shares of the Trust on NYSE Arca as an exchange-traded product and on July 22, 2024, the Sponsor authorized the commencement of a redemption program once the registration statement on Form S-3, as amended, was declared effective. F- 16 Years Ended December 31, 2024 2023 Activity in Number of Shares Issued and Redeemed: Shares issued 480,000 - Shares redeemed ( 141,540,000 ) - Net Change in Number of Shares Issued and Redeemed ( 141,060,000 ) - Years Ended December 31, (Amounts in thousands) 2024 2023 Activity in Value of Shares Issued and Redeemed: Shares issued $ 14,886 $ - Shares redeemed ( 3,611,158 ) - Return of Capital (1) ( 1,010,935 ) - Net Change in Value of Shares Issued and Redeemed $ ( 4,607,207 ) $ - (1) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $ 1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4. Ether receivable represents the value of Ether covered by contractually binding orders for the creation of Shares where the Ether has not yet been transferred to the Trust’s account. Generally, ownership of the Ether is transferred within no more than two business days of the trade date. As of December 31, (Amounts in thousands) 2024 2023 Ether receivable $ - $ - Ether payable represents the value of Ether covered by contractually binding orders for the redemption of Shares where the Ether has not yet been transferred out of the Trust’s account. Generally, ownership of the Ether is transferred within no more than two business days of the trade date. As of December 31, (Amounts in thousands) 2024 2023 Ether payable $ - $ - 6. Income Taxes The Sponsor takes the position that the Trust is properly treated as a grantor trust for U.S. federal income tax purposes. Assuming that the Trust is a grantor trust, the Trust will not be subject to U.S. federal income tax. Rather, if the Trust is a grantor trust, each beneficial owner of Shares will be treated as directly owning its pro rata Share of the Trust’s assets and a pro rata portion of the Trust’s income, gain, losses and deductions will “flow through” to each beneficial owner of Shares. If the Trust were not properly classified as a grantor trust, the Trust might be classified as a partnership for U.S. federal income tax purposes. However, due to the uncertain treatment of digital assets, including forks, airdrops and similar occurrences for U.S. federal income tax purposes, there can be no assurance in this regard. If the Trust were classified as a partnership for U.S. federal income tax purposes, the tax consequences of owning Shares generally would not be materially different from the tax consequences described herein, although there might be certain differences, including with respect to timing. In addition, tax information reports provided to beneficial owners of Shares would be made in a different form. If the Trust were not classified as either a grantor trust or a partnership for U.S. federal income tax purposes, it would be classified as a corporation for such purposes. In that event, the Trust would be subject to entity-level U.S. federal income tax (currently at the rate of 21 %) on its net taxable income and certain distributions made by the Trust to shareholders would be treated as taxable dividends to the extent of the Trust’s current and accumulated earnings and profits. F- 17 In accordance with U.S. GAAP, the Trust has defined the threshold for recognizing the benefits of tax return positions in the financial statements as “more-likely-than-not” to be sustained by the applicable taxing authority and requires measurement of a tax position meeting the “more-likely-than-not” threshold, based on the largest benefit that is more than 50% likely to be realized. Tax positions not deemed to meet the “more-likely-than-not” threshold are recorded as a tax benefit or expense in the current period. As of and during the years ended December 31, 2024, 2023, and 2022, the Trust did not have a liability for any unrecognized tax amounts. However, the Sponsor’s conclusions concerning its determination of “more-likely-than-not” tax positions may be subject to review and adjustment at a later date based on factors including, but not limited to, further implementation guidance, and ongoing analyses of and changes to tax laws, regulations and interpretations thereof. The Sponsor of the Trust has evaluated whether or not there are uncertain tax positions that require financial statement recognition and has determined that no reserves for uncertain tax positions related to federal, state and local income taxes existed as of December 31, 2024 or 2023 . 7. Related Parties The Trust considered the following entities, their directors, and certain employees to be related parties of the Trust as of December 31, 2024: DCG, Grayscale and Grayscale Securities. As of December 31, 2024 and 2023, 5,858 and 12,277 Shares of the Trust were held by related parties of the Trust, respectively. Genesis Global Trading, Inc. filed a certificate of dissolution in August 2024, and has therefore been removed from the list of related parties. In accordance with the Trust Agreement governing the Trust, the Trust pays a fee to the Sponsor, calculated as 2.5 % of the aggregate value of the Trust’s assets, less its liabilities (which include any accrued but unpaid expenses up to, but excluding, the date of calculation), as calculated and published by the Sponsor or its delegates in the manner set forth in the Trust Agreement (the “Sponsor’s Fee”). The Sponsor’s Fee accrues daily in U.S. dollars and is payable in Ether, daily in arrears. The amount of Ether payable in respect of each daily U.S. dollar accrual will be determined by reference to the same U.S. dollar value of Ether used to determine such accrual. For purposes of these financial statements, the U.S. dollar value of Ether is determined by reference to the Digital Asset Trading Platform Market that the Trust considers its principal market as of 4:00 p.m., New York time, on each valuation date. The Trust held no Incidental Rights or IR Virtual Currency as of December 31, 2024 and 2023 . No Incidental Rights or IR Virtual Currencies have been distributed in payment of the Sponsor’s Fee during the years ended December 31, 2024, 2023 and 2022. As partial consideration for receipt of the Sponsor’s Fee, the Sponsor is obligated under the Trust Agreement to assume and pay all fees and other expenses incurred by the Trust in the ordinary course of its affairs, excluding taxes, but including marketing fees; administrator fees, if any; custodian fees; transfer agent fees; trustee fees; the fees and expenses related to the listing, quotation or trading of the Shares on any secondary market (including customary legal, marketing and audit fees and expenses) in an amount up to $ 600,000 in any given fiscal year; ordinary course legal fees and expenses; audit fees; regulatory fees, including, if applicable, any fees relating to the registration of the Shares under the Securities Act or the Exchange Act; printing and mailing costs; the costs of maintaining the Trust’s website and applicable license fees (together, the “Sponsor-paid Expenses”), provided that any expense that qualifies as an Additional Trust Expense will be deemed to be an Additional Trust Expense and not a Sponsor-paid Expense. The Trust may incur certain extraordinary, non-recurring expenses that are not Sponsor-paid Expenses, including, but not limited to, taxes and governmental charges, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of shareholders, any indemnification of the Custodian or other agents, service providers or counterparties of the Trust, the fees and expenses related to the listing, quotation or trading of the Shares on any secondary market (including legal, marketing and audit fees and expenses) to the extent exceeding $ 600,000 in any given fiscal year and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters (collectively “Additional Trust Expenses”). In such circumstances, the Sponsor or its delegate (i) will instruct the Custodian to withdraw from the Vault Balance Ether in such quantity as may be necessary to permit payment of such Additional Trust Expenses and (ii) may either (x) cause the Trust (or its delegate) to convert such Ether into U.S. dollars or other fiat currencies at the Actual Exchange Rate or (y) when the Sponsor incurs such expenses on behalf of the Trust, cause the Trust (or its delegate) to deliver such Ether in kind to the Sponsor, in each case in such quantity as may be necessary to permit payment of such Additional Trust Expenses. For the years ended December 31, 2024, 2023 and 2022, the Trust incurred Sponsor’s Fees of $ 182,594,095 , $ 134,484,415 and $ 153,242,544 , respectively. As of December 31, 2024 and 2023 , there were no accrued and unpaid Sponsor’s Fees. In addition, the Sponsor may pay Additional Trust Expenses on behalf of the Trust, which are reimbursable by the Trust to the Sponsor. For the years ended December 31, 2024, 2023 and 2022 , the Sponsor did no t pay any Additional Trust Expenses on behalf of the Trust. F- 18 On March 2, 2022, the board of the Sponsor (the “Board”) approved the purchase by DCG, the indirect parent company of the Sponsor, of up to an aggregate total of $ 200 million worth of Shares of the Trust and shares of any of the following five investment products the Sponsor also acts as the sponsor and manager of, including Grayscale Bitcoin Trust ETF (NYSE Arca: GBTC), Grayscale Bitcoin Cash Trust (BCH) (OTCQX: BCHG), Grayscale Digital Large Cap Fund LLC (OTCQX: GDLC), Grayscale Ethereum Classic Trust (ETC) (OTCQX: ETCG), and Grayscale Stellar Lumens Trust (XLM) (OTCQX: GXLM). Subsequently, DCG authorized such purchase. The Share purchase authorization does not obligate DCG to acquire any specific number of Shares in any period, and may be expanded, extended, modified, or discontinued at any time. From March 2, 2022 through December 31, 2024 , DCG had no t purchased any Shares of the Trust under this authorization. As previously described in Note 4, on July 23, 2024, the Trust completed its previously announced pro rata distribution of 310,158,500 shares of the ETH Trust to shareholders of the Trust as of 4:00 PM ET on the Record Date and contributed to the ETH Trust an amount of Ether equal to approximately 10 % of the total Ether held by the Trust as of the Record Date, equal to 292,262.98913350 Ether, as consideration and in exchange for the issuance of shares of the ETH Trust. 8. Risks and Uncertainties The Trust is subject to various risks including market risk, liquidity risk, and other risks related to its concentration in a single asset, Ether. Investing in Ether is currently highly speculative and volatile. The Principal Market NAV of the Trust, calculated by reference to the principal market price in accordance with U.S. GAAP, relates primarily to the value of Ether held by the Trust, and fluctuations in the price of Ether could materially and adversely affect an investment in the Shares of the Trust. The price of Ether has a limited history. During such history, Ether prices have been volatile and subject to influence by many factors, including the levels of liquidity. If the Digital Asset Markets continue to experience significant price fluctuations, the Trust may experience losses. Several factors may affect the price of Ether, including, but not limited to, global Ether supply and demand, theft of Ether from global trading platforms or vaults, competition from other forms of digital currency or payment services, global or regional political, economic or financial conditions, and other unforeseen events and situations. The Ether held by the Trust are commingled, and the Trust’s shareholders have no specific rights to any specific Ether. In the event of the insolvency of the Trust, its assets may be inadequate to satisfy a claim by its shareholders. There is currently no clearing house for Ether, nor is there a central or major depository for the custody of Ether. There is a risk that some or all of the Trust’s Ether could be lost or stolen. There can be no assurance that the Custodian will maintain adequate insurance or that such coverage will cover losses with respect to the Trust’s Ether. Further, transactions in Ether are irrevocable. Stolen or incorrectly transferred Ether may be irretrievable. As a result, any incorrectly executed Ether transactions could adversely affect an investment in the Shares. The SEC has stated that certain digital assets may be considered “securities” under the federal securities laws. The test for determining whether a particular digital asset is a “security” is complex and difficult to apply, and the outcome is difficult to predict. Public, though non-binding, statements by senior officials at the SEC have indicated that the SEC did not consider Bitcoin or Ether to be securities, and does not currently consider Bitcoin to be a security. In addition, the SEC appears to have implicitly taken the view that Ether is not a security (i) by not objecting to Ether futures trading on Commodity Futures Trading Commission-regulated markets under rules designed for futures on non-security commodity underliers and (ii) by approving the listing and trading of exchange-traded products (“ETPs”) that invest in Ether (i.e., approving the redemption of shares of the Trust) under the rules for commodity-based trust shares, without requiring these ETPs to be registered as investment companies. Likewise, in various courts filings and arguments the SEC has distinguished Ether from assets that it claimed were securities, and in judicial opinions, courts have accepted or even assumed that Ether is not a security. Moreover, in a recent settlement with another market participant relating to allegations that it acted as an unregistered broker-dealer for facilitating trading in certain digital assets, the SEC highlighted that the firm would cease trading in all digital assets other than Bitcoin, Bitcoin Cash and Ether—activity that, if the SEC believed Ether was presently a security—would continue to constitute unregistered brokerage activity. The SEC staff has also provided informal assurances via no-action letter to a handful of promoters that their digital assets are not securities. On the other hand, the SEC has brought enforcement actions against the issuers and promoters of several other digital assets on the basis that the digital assets in question are securities and has not formally or explicitly confirmed that it does not deem Ether to be a security. If Ether is determined to be a “security” under federal or state securities laws by the SEC or any other agency, or in a proceeding in a court of law or otherwise, it may have material adverse consequences for Ether. For example, it may become more difficult for Ether to be traded, cleared and custodied as compared to other digital assets that are not considered to be securities, which could, in turn, negatively affect the liquidity and general acceptance of Ether and cause users to migrate to other digital assets. As such, any determination that Ether is a security under federal or state securities laws may adversely affect the value of Ether and, as a result, an investment in the Shares. F- 19 In addition, if Ether is in fact a security, the Trust could be considered an unregistered “investment company” under the Investment Company Act of 1940, which could necessitate the Trust’s liquidation. In this case, the Trust and the Sponsor may be deemed to have participated in an illegal offering of securities and there is no guarantee that the Sponsor will be able to register the Trust under the Investment Company Act of 1940 at such time or take such other actions as may be necessary to ensure the Trust’s activities comply with applicable law, which could force the Sponsor to liquidate the Trust. To the extent a private key required to access an address on the Ethereum Network holding Ether is lost, destroyed or otherwise compromised and no backup of the private keys are accessible, the Trust may be unable to access the Ether controlled by the private key and the private key will not be capable of being restored by the Ethereum Network. The processes by which Ether transactions are settled are dependent on the Ethereum peer-to-peer network, and as such, the Trust is subject to operational risk. A risk also exists with respect to previously unknown technical vulnerabilities, which may adversely affect the value of Ether. The Trust relies on third-party service providers to perform certain functions essential to its operations. Any disruptions to the Trust’s service providers’ business operations, resulting from business failures, financial instability, security failures, government mandated regulation or operational problems could have an adverse impact on the Trust’s ability to access critical services and be disruptive to the operations of the Trust. The Sponsor and the Trust may be subject to various litigation, regulatory investigations, and other legal proceedings that arise in the ordinary course of its business. F- 20 9. Quarterly Statements of Operations Fiscal Year Ended December 31, 2024 Three Months Ended (unaudited) (Amounts in thousands) Mar-31, 2024 Jun-30, 2024 Sept-30, 2024 Dec-31, 2024 Year Ended December 31, 2024 Expenses Sponsor’s Fee, related party $ 53,493 $ 61,440 $ 38,003 $ 29,658 $ 182,594 Net investment loss $ ( 53,493 ) $ ( 61,440 ) $ ( 38,003 ) $ ( 29,658 ) $ ( 182,594 ) Net realized and unrealized gain (loss) from: Net realized gain on investment in Ether sold to pay expenses 45,780 53,774 32,416 25,587 157,557 Net realized gain on investment in Ether sold for redemption of Shares - - 2,459,785 648,240 3,108,025 Net realized gain on investment in Ether sold for Initial Distribution (Return of Capital) (1) - - 888,140 - 888,140 Net change in unrealized appreciation on investment in Ether 3,960,769 ( 687,658 ) ( 5,157,790 ) 498,684 ( 1,385,995 ) Net realized and unrealized gain (loss) on investment 4,006,549 ( 633,884 ) ( 1,777,449 ) 1,172,511 2,767,727 Net increase (decrease) in net assets resulting from operations $ 3,953,056 $ ( 695,324 ) $ ( 1,815,452 ) $ 1,142,853 $ 2,585,133 (1) Represents the impact of the Initial Distribution of 292,262.98913350 Ether, with a value of approximately $ 1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4. Fiscal Year Ended December 31, 2023 Three Months Ended (unaudited) (Amounts in thousands) Mar-31, 2023 Jun-30, 2023 Sept-30, 2023 Dec-31, 2023 Year Ended December 31, 2023 Expenses Sponsor’s Fee, related party $ 29,638 $ 34,879 $ 33,146 $ 36,821 $ 134,484 Net investment loss $ ( 29,638 ) $ ( 34,879 ) $ ( 33,146 ) $ ( 36,821 ) $ ( 134,484 ) Net realized and unrealized gain (loss) from: Net realized gain on investment in Ether 21,794 26,999 25,228 28,952 102,973 Net change in unrealized appreciation on investment in Ether 1,880,269 264,140 ( 762,834 ) 1,758,792 3,140,367 Net realized and unrealized gain (loss) on investment 1,902,063 291,139 ( 737,606 ) 1,787,744 3,243,340 Net increase (decrease) in net assets resulting from operations $ 1,872,425 $ 256,260 $ ( 770,752 ) $ 1,750,923 $ 3,108,856 F- 21 10. Financial Highlights Per Share Performance Years Ended December 31, 2024 2023 2022 Per Share Data: Principal market net asset value, beginning of year $ 21.79 $ 11.77 $ 36.60 Net increase (decrease) in net assets from investment operations: Net investment loss ( 0.70 ) ( 0.43 ) ( 0.49 ) Net realized and unrealized gain (loss) (1) 6.92 10.45 ( 24.34 ) Net increase (decrease) in net assets resulting from operations 6.22 10.02 ( 24.83 ) Principal market net asset value, end of year $ 28.01 $ 21.79 $ 11.77 Total return (1) 42.83 % 85.13 % - 67.84 % Ratios to average net assets: Net investment loss - 2.50 % - 2.50 % - 2.50 % Expenses - 2.50 % - 2.50 % - 2.50 % (1) Includes the impact of the Initial Distribution of 292,262.98913350 Ether, representing 0.00094230 Ether per Share, with a value of approximately $ 1,010.9 million to Grayscale Ethereum Mini Trust ETF, completed on July 23, 2024, as discussed in Note 4. An individual shareholder’s return, ratios, and per Share performance may vary from those presented above based on the timing of Share transactions. The amount shown for a Share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the number of Shares issued in Creations occurring at an operational value derived from an operating metric as defined in the Trust Agreement. Total return is calculated assuming an initial investment made at the Principal Market NAV at the beginning of the year and assuming redemption on the last day of the year. 11. Indemnifications In the normal course of business, the Trust enters into certain contracts that provide a variety of indemnities, including contracts with the Sponsor and affiliates of the Sponsor, DCG and its officers, directors, employees, subsidiaries and affiliates, and the Custodian as well as others relating to services provided to the Trust. The Trust’s maximum exposure under these and its other indemnities is unknown. However, no liabilities have arisen under these indemnities in the past and, while there can be no assurances in this regard, there is no expectation that any will occur in the future. Therefore, the Sponsor does not consider it necessary to record a liability in this regard. F- 22 12. Subsequent Events On January 1, 2025, Grayscale Investments, LLC (“GSI”) consummated an internal corporate reorganization (the “Reorganization”), pursuant to which Grayscale Investments, LLC, the Sponsor of the Trust prior to the Reorganization, merged with and into Grayscale Operating, LLC (“GSO”), a Delaware limited liability company and a wholly owned indirect 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. The Reorganization is not expected to have any material impact on the operations of the Trust. In connection with the Reorganization, on January 1, 2025, and promptly following the effectiveness of the Merger, GSO assigned certain contracts pertaining to its role as Sponsor (as such term is defined in the Trust Agreement) of the Trust (such contracts, the “Sponsor Contracts”) to Grayscale Investments Sponsors, LLC, a Delaware limited liability company and a wholly owned direct subsidiary of GSO (“GSIS”), whereby GSIS assumed all of the rights and obligations of GSO under the Sponsor Contracts. Other than the assumption of the Sponsor Contracts by GSIS, the Reorganization does not alter the rights or obligations under any of the Sponsor Contracts. In connection with the Reorganization, on January 1, 2025, and promptly following the effectiveness of the Merger, GSO and GSIS executed a Certificate of Admission, pursuant to which GSIS was admitted as an additional Sponsor of the Trust under the Trust Agreement, by and among GSO (as successor in interest to GSI), the Trustee, and the shareholders from time to time thereunder, as amended from time to time. GSIS shall be subject to the rights and obligations of a Sponsor under the Trust Agreement. On January 3, 2025, GSO voluntarily withdrew as a Sponsor of the Trust pursuant to the terms of the Trust Agreement, and, effective May 3, 2025, GSIS shall be the sole remaining Sponsor of the Trust. As of the close of business on February 24, 2025 , the fair value of Ether determined in accordance with the Trust’s accounting policy was $ 2,642.58 per Ether. There are no known events that have occurred that require disclosure other than that which has already been disclosed in these notes to the financial statements. F- 23