CoinShares Digital Securities Limited: Management fee holiday for Physical Ethereum ETP

CoinShares announces reinvestment of proceeds from Ethereum Fork

September 23, 2022 | SAINT HELIER, Jersey - CoinShares Digital Securities Limited ("CSDS" or the "Issuer") the wholly owned subsidiary and Issuer of the CoinShares Physical range of Exchange-Traded Products (ETPs) has exercised certain of its discretions following the recent merge event in the Ethereum network.

The affected security, CoinShares Physical Ethereum, is listed on the SIX Swiss Exchange, Xetra in Germany, and Euronext in France and the Netherlands.

CoinShares Physical Ethereum

Tickers: ETHE / CETH

ISIN: GB00BLD4ZM24

WKN: A3GQ2N

The Issuer has been closely following the developments in the Ethereum protocol, with respect to both the proposed move (the "Merge") to a Proof of Stake consensus network (as so moved, "ETHPoS") as well as the forks (the "Fork") of the existing Proof of Work consensus network which resulted in the creation of two new Digital Currencies: Ethereum Proof of Work ("ETHPoW") and Ethereum Fair ("ETHFair").  As a result of the Fork, the Issuer received an amount of ETHPoW and ETHFair in relation to its holding of ETH.

The Fork constituted a Fork Event for the purposes of the Conditions and the Issuer is hereby announcing that it has exercised its discretion pursuant to Condition 15.4(aa) to sell the new Digital Currencies and re-invest them into ETHPoS in accordance with Condition 15.4A.  This has resulted in an adjustment to the Coin Entitlement of the CoinShares Physical Ethereum Digital Securities.

The Issuer is informing investors as soon as reasonably practical that it has disposed of its holding of ETHPoW and ETHFair and acquired additional ETHPoS commencing September 21 and concluding on September 22, 2022.  The Issuer is further announcing that the Determination Agent has made a calculation for an updated Coin Entitlement of the CoinShares Physical Ethereum Digital Securities of 0.02955003 per Digital Security, effective as of September 26, 2022. 

The Issuer has been monitoring the markets for the new Digital Currencies and believes, in light of recent price movements and risks associated with the new protocols, that this decision is in the interest of the present and future Security Holders of the Digital Securities of the CoinShares Physical Ethereum class as well as the continuing functioning of the Programme in relation to the Digital Securities of the CoinShares Physical Ethereum class.

Terms used in this announcement and not otherwise defined bear the same meanings as used in the base prospectus of the Issuer dated April 20, 2022

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