Grayscale has introduced a new Exchange-Traded Fund aimed at turning Ethereum price movements into investors’ normal income.
A product called Grayscale Ethereum Cover Call ETF (ETCO) will be released on September 4th and will distribute dividends every two weeks. The company said ETCO uses a covered call strategy instead of holding ETH directly.
The company said the fund is tracking existing Ethereum Exchange-Traded products, including Grayscale Ethereum Trust (ETHE) and Ethereum Mini Trust (ETH), and writing call options to earn additional yields.
This structure allows investors to benefit from Ethereum volatility while adding income streams to their portfolios.
Grayscale added:
“By writing call options that are closer to spot prices, ETCO is an income-first strategy that prioritizes revenue generation and may appeal to investors looking for consistent cash flow and high yield opportunities. The premiums collected through this approach will help reduce the impact of market declines and potentially reduce the volatility of the slump.”
Christa Lynch, the company’s senior vice president of the ETF capital market, said ETFs are intended to complement existing ETH exposures rather than exchange them. She emphasized that the product reflects Grayscale’s strategy of achieving various investors’ goals with tailored solutions.
At launch, ETCO reported a net asset value of $35.01 per share, with 40,000 shares outstanding and under control of over $1.4 million.
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Ethereum ETF leak
The new Greyscale fund comes during the period of weakness of Ethereum-centric ETFs following a strong influx.
SOSO value data shows investors withdraw $338.25 million from these products in three consecutive sessions, reversing momentum from August when funds saw an inflow of $3.87 billion.
In particular, August ranked as the second-strongest of the year, following its record in August at $5.43 billion.
The Ethereum ETF has been solidly positive this year despite its latest leak, with a cumulative net inflow of nearly $30 billion since its launch in 2024.
This resilience suggests that institutional demand for ETH exposure continues to grow, even as short-term emotions change.