Grayscale Launches Ethereum Covered Call ETF to Monetize ETH Price Swings

• Grayscale’s ETCO launch marking another milestone for income-focused crypto products, widening investor options.
• As the ETH continues to attract strong institutional interests, with some of new products like ETCO potentially fueling long-term growth.

The Grayscale Investments, the world’s largest digital asset investment manager, has just revealed its latest exchange-traded fund (ETF), called, the Grayscale Ethereum Covered Call ETF (ETCO), launched on September 4, 2025. This launch follows the reports by Crypto News Flash (CNF) earlier when the first-year inflow of an Ethereum ETF approved by the SEC could reach $45 billion.

Importantly, this launch marks a major expansion of Grayscale’s income-focused product lineup, showing the growing institutional and retail interest in Ethereum’s blockchain ecosystem.

The new fund, as detailed in Grayscale’s updates, is different from traditional spot Ethereum ETFs that directly track ETH’s price. As the ETCO also does not hold Ethereum per se. But, it uses derivatives tied instead to ETPs, generating income through option premiums while limiting upside during strong ETH rallies. As further stated, the Ethereum Foundation’s treasury exists to uphold Ethereum’s mission of enabling:

The fund’s expense ratio is about 0.66%, and at launch, it reported a net asset value of $35.01 per share with $1.4 million in assets under management (AUM). Even so, ETCO comes at a time of renewed interest in Ethereum, which has outperformed Bitcoin (BTC) in 2025, gaining 34% year-to-date compared to BTC’s 20% price.

Implications for Ethereum’s Market Price

The launch of ETCO could affect Ethereum’s (ETH) price in several ways. By doing the writing call options mentioned above on Ethereum ETPs, ETCO may would boost demand for these underlying products, since option holders might purchase ETHE or ETH shares to exercise contracts.

Grayscale also explained further detailed that its approach is based on two variables: annual operating expenses (A) and years of operating buffer (B). Together, A × B sets the target fiat reserves, which directly guide the size and timing of ETH sales.

As for the pricewise, therefore, as for financial strategy and ETH price effects, Grayscale also explained that treasury sales are linked to operating needs, formulated that:

To this end, this means that the treasury-driven ETH sales, could influence short-term price moves, beside of the necessary for operations, especially if large sales coincide with market volatility.

Furthermore, revisiting a CNF’s analysis of ETH’s recent rally past $4,000 for the first time since 2024, it’s clear that products like ETCO could change how investors view crypto—combining traditional strategies with blockchain opportunities.

As of now, However, the Ethereum (ETH) is trading at $4,320.82 with a decrease of 2% in the past day and 3.68% in the past week. See ETH Price chart below.