VanEck Advisor Warns Against Coinbase as Majority Ethereum ETF Custodian
- Gabor Gurbacs, a VanEck advisor, has raised concerns about the concentration risk of using Coinbase as the custodian for most spot Ethereum ETFs in the U.S.
- Coinbase currently holds assets for 8 out of 9 Ethereum ETFs and 10 out of 11 Bitcoin ETFs.
- VanEck has chosen Gemini, while Fidelity will offer self-custody for their Ethereum ETFs.
Despite recognizing Coinbase’s security capabilities, Gurbacs questions the risk management of fund issuers relying heavily on a single custodian, highlighting an unnecessary risk for investors. Dave Abner from Dabner Capital Partners also criticized this approach, suggesting a multi-custodian setup for better protection.
The approval of spot Ethereum ETFs echoes concerns originally raised with Bitcoin ETFs, where similar custodian choices were made.
Looking ahead, diverse custodial practices could mitigate risks, ensuring greater security and stability for investors in the burgeoning ETF market.
