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Item 7. Management’s Discussion and Analysis

2026-03-30 compared with 2025-03-26 · 83 added, 86 removed, 17 unchanged (91% of the section changed)

Management’s Discussion and Analysis of Financial Condition

and Results of Operations.

This information should be read in conjunction with the financial

statements and notes to financial statements included with this report.

The discussion and analysis that follows may contain statements

that relate to future events or future performance.

In some cases, such forward-looking statements can be identified by terminology such

as “may,” “will,” “should,” “could,” “expect,” “plan,” “anticipate,”

“believe,” “estimate,” “predict,” “potential” or the negative of these terms or other

comparable terminology.

All statements (other than statements of historical fact) included in this Report that address activities, events

or developments that may occur in the future, including such matters as changes in commodity prices and market conditions (for ethereum

and the Shares), the operations of the Trust, the plans of the Sponsor and references to the Trust’s future success and other similar

matters are forward-looking statements.

These statements are only predictions.

Management’s Discussion and Analysis of Financial

Condition and Results of Operations.

This information should be read in conjunction with the

financial statements and notes to financial statements included with this report.

The discussion and analysis that follows may

contain statements that relate to future events or future performance.

In some cases, such forward-looking statements can be identified

by terminology such as “may,” “will,” “should,” “could,” “expect,”

“plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential”

or the negative of these terms or other comparable terminology.

All statements (other than statements of historical fact) included

in this Report that address activities, events or developments that may occur in the future, including such matters as changes

in commodity prices and market conditions (for ethereum and the Shares), the operations of the Trust, the plans of the Sponsor

and references to the Trust’s future success and other similar matters are forward-looking statements.

These statements are

only predictions.

Actual events or results may differ materially.

These statements

are based upon certain assumptions and analyses made by the Sponsor on the basis of its perception of historical trends, current conditions

and expected future developments, as well as other factors it believes are appropriate in the circumstances.

Whether or not actual results

and developments will conform to the Sponsor’s expectations and predictions is subject to a number of risks and uncertainties, including

the special considerations discussed in this Report, general economic, market and business conditions, changes in laws or regulations,

including those concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments.

Consequently, all the forward-looking statements made in this Report are qualified by these cautionary statements, and there can be no

assurance that the actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, will result

in the expected consequences to, or have the expected effects on, the Trust’s operations or the value of the Shares issued by the

Moreover, neither the Sponsor nor any other person assumes responsibility for the accuracy or completeness of the forward-looking

Neither the Trust nor the Sponsor undertakes an obligation to publicly update or conform to actual results any forward-looking

statement, whether as a result of new information, future developments or otherwise, except as required by law.

These statements are based upon certain assumptions and analyses

made by the Sponsor on the basis of its perception of historical trends, current conditions and expected future developments, as

well as other factors it believes are appropriate in the circumstances.

Whether or not actual results and developments will conform

to the Sponsor’s expectations and predictions is subject to a number of risks and uncertainties, including the special considerations

discussed in this Report, general economic, market and business conditions, changes in laws or regulations, including those concerning

taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments.

Consequently,

all the forward-looking statements made in this Report are qualified by these cautionary statements, and there can be no assurance

that the actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, will result

in the expected consequences to, or have the expected effects on, the Trust’s operations or the value of the Shares issued

by the Trust.

Moreover, neither the Sponsor nor any other person assumes responsibility for the accuracy or completeness of the

forward-looking statements.

Neither the Trust nor the Sponsor undertakes an obligation to publicly update or conform to actual

results any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required

The Trust is a Delaware statutory trust.

The Trust does not have directors,

officers or employees.

The Trust does not

have directors, officers or employees.

The creation and operation of the Trust has been arranged by the Sponsor.

The Trust is administered by the Trust

Agreement, among the Sponsor, the Trustee and the Delaware Trustee.

The Trust is managed and controlled by the Sponsor, a wholly-owned

subsidiary of VanEck.

The Trust is administered

by the Trust Agreement, among the

Sponsor, the Trustee and the Delaware Trustee.

The Trust is managed and controlled by the Sponsor,

a wholly-owned subsidiary of VanEck.

The Sponsor is not governed by a board of directors.

5 unchanged sentences

losses caused by, changes in the price of ETH.

The Trust issues and redeems Shares only in aggregations of 25,000 Shares,

a Basket, or integral multiples thereof, and only in transactions with Authorized Participants.

Shares of the Trust trade on the Exchange under the ticker symbol “ETHV.”

The Trust issues and redeems Shares only in aggregations of

25,000 Shares, a Basket, or integral multiples thereof, and only in transactions with Authorized Participants.

Shares of the Trust trade on the Exchange under the ticker

symbol “ETHV.”

Computation of Net Asset Value

The Trust’s NAV is calculated based on the Trust’s net asset

holdings as reconciled to the ETH Custodians’ accounts on a market approach, determined on a daily basis in accordance with

the MarketVector TM Ethereum Benchmark Rate price at 4:00 p.m.

The Trust’s NAV per Share is calculated by taking the

current market value of its total assets, subtracting any liabilities, and then dividing that total by the total number of outstanding

The Trust Agreement gives the Sponsor the exclusive authority to determine the Trust’s NAV and the Trust’s NAV per

Share, which it has delegated to the Administrator.

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.

In exchange for a 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 period covered by this Report

was the Sponsor’s Fee.

The Trust’s NAV is calculated based on the Trust’s

net asset holdings as reconciled to the ETH Custodians’ accounts on a market approach, determined on a daily basis in accordance

with the MarketVector Ethereum Benchmark Rate price at 4:00 p.m.

The Trust’s NAV per Share is calculated

by taking the current market value of its total assets, subtracting any liabilities, and then dividing that total by the total

number of outstanding Shares.

The Trust Agreement gives the Sponsor the exclusive authority to determine the Trust’s NAV

and the Trust’s NAV per Share, which it has delegated to the Administrator.

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.

In exchange for a 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 period

covered by this Report was the Sponsor’s Fee.

The Trust’s only source of liquidity is its sales of ethereum.

Significant Accounting Policies

In preparing financial statements in conformity with accounting principles

generally accepted in the United States of America (“GAAP”), management makes estimates and assumptions that affect the reported

amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, as well as

the reported amount of revenue and expenses reported during the period.

Actual results could differ from these estimates.

please refer to Note 2 to the Financial Statements included in this Report for further discussion of the Trust’s accounting policies.

of Operations

In preparing financial statements in conformity with accounting

principles generally accepted in the United States of America (“GAAP”), management makes estimates and assumptions

that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the

financial statements, as well as the reported amount of revenue and expenses reported during the period.

Actual results could differ

from these estimates.

In addition, please refer to Note 2 to the Financial Statements included in this Report for further discussion

of the Trust’s accounting policies.

Results of Operations

The Year Ended December 31, 2025

From January 1, 2024 to May 20, 2024 (date of Seeding), the Trust had

no operations other than a sale to the Seed Capital Investor, the parent of the Sponsor, of 2,000 Shares at a per-Share price of $50.00.

Delivery of the Seed Shares was made on May 20, 2024.

Total proceeds to the Trust from the sale of the Seed Shares were $100,000.

On June 25, 2024 (date of initial ether investment), the Seed Shares

were redeemed for cash and the Seed Capital Investor purchased the Seed Creation Baskets, comprising of 200,000 Shares at a per-Share

price of $50.00.

Total proceeds to the Trust from the sale of the Seed Creation Baskets were $10,000,000, which resulted in the Trust

receiving 2,929.06 ethereum.

Delivery of the Seed Creation Baskets was made on June 26, 2024.

The Seed Capital Investor acted as a statutory

underwriter in connection with this purchase.

The Trust’s NAV increased from $100,000 at May 20, 2024 to $146,428,902

at December 31, 2024, a 146,329% increase.

The increase in the Trust’s NAV resulted primarily from an increase in the number of

outstanding Shares, which increased from 2,000 Shares at May 20, 2024 to 3,000,000 Shares at December 31, 2024.

This is the net result

of 2,000 Seed Shares and 3,400,000 Shares (136 Baskets) being created and 2,000 Seed Shares and 400,000 Shares (16

Baskets) being redeemed

during the period, partially offset by a decrease in the price of ETH, which contracted 2.37% from $3,414 at June 25, 2024 to $3,333

The Trust’s NAV increased from $146,428,902 at December

31, 2024 to $157,578,941 at December 31, 2025, a 7.61% increase.

The increase in the Trust’s NAV resulted primarily from

an increase in the number of outstanding Shares, which increased from 3,000,000 Shares at December 31, 2024 to 3,625,000 Shares

at December 31, 2025.

The 2.38% decrease in the NAV per Share from $50.00 at May 20, 2024

This is the net result of 3,225,000 Shares (129 Baskets) being created 2,600,000 Shares (104 Baskets) being

redeemed during the period, partially offset by a decrease in the price of ETH, which contracted 10.86% from $3,333 at December

31, 2024 to $2,971 at December 31, 2025.

The 10.94% decrease in the NAV per Share from $48.81 at December

31, 2024 to $43.47 at December 31, 2025 is directly related to the 10.86% decrease in the price of ETH during this period.

The NAV per Share of $59.67 on December 6, 2024, was the highest during

the period, compared with a low during the period of $32.59 on September 6, 2024.

Net increase in net assets resulting from operations for the twelve-month

period ended December 31, 2024, was $8,627,398 resulting from an net unrealized appreciation on investment in ethereum of $10,194,816,

a net realized loss of $1,567,418 on ethereum sold for the redemption of Shares and a net investment income of $0.

The Trust had no expenses

during the period as the Sponsor Fee was waived by the Sponsor.

Quantitative and Qualitative Disclosures About Market Risk.

The NAV per Share of $70.58 on August 22, 2025, was the highest

during the period, compared with a low during the period of $21.45 on April 8, 2025.

Net decrease in net assets resulting from operations for the

twelve-month period ended December 31, 2025, was $ 33,759,054 resulting from an net unrealized depreciation on investment in ethereum

of $34,062,356, a net realized gain of $492,055 on ethereum sold for the redemption of Shares, a net realized gain of $16,597 from

ethereum sold to pay expenses during the twelve-month period, and a net investment loss of $205,350.

Other than the Sponsor Fee

of $205,350, the Trust had no other expenses during the twelve-month period.

Quantitative and Qualitative Disclosures About

Not applicable.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis