VanEck Ethereum ETF (ETHV) is a Delaware statutory trust grantor structure that holds spot ether (ETH) as its sole asset, custodied at Gemini Trust Company and Coinbase Custody Trust Company. Under the liquidation lens, this entity presents a structurally clean recovery posture: total assets at March 31, 2026 consist entirely of 50,825.75 ETH carried at Level 1 fair value of $106.8M, against total liabilities of $19,105 (accrued Sponsor fee only). Net assets are $106.8M, implying a liquidation recovery ratio effectively at par — nearly 100 cents on the dollar — because the single asset is mark-to-market liquid and the liability stack is de minimis. The standard liquidation haircut framework for an ETF holding spot crypto would assign a recovery factor reflecting market depth and liquidation execution risk rather than the standard intangibles/PP&E zero-recovery conventions. ETH is a deep, liquid market; however, a forced liquidation of 50,826 ETH at a single point in time would involve non-trivial market impact, which the filing does not quantify. No debt, no lease obligations, no pension, no goodwill, no intangibles, no deferred revenue. The Sponsor fee is the only liability and is immaterial. Compared to the prior period end (December 31, 2025), total assets declined from $171.7M to $106.8M — a 37.8% reduction driven primarily by: (1) a 29.28% decline in spot ETH price ($2,971 to $2,101), generating $30.2M of unrealized depreciation; (2) net redemptions of $6.0M (1.15M shares redeemed vs. 1.0M issued); and (3) $14.5M of realized losses on ETH sold for redemptions. The cost basis of ETH held dropped from $181.5M to $160.9M, while fair value dropped to $106.8M, creating an unrealized loss position of $54.1M (cost exceeds fair value by 33.6%) — a material embedded impairment under any cost-basis framework, though under ASC 946 investment company accounting this flows through P&L currently. The fee waiver that had covered the full 0.20% Sponsor fee through July 22, 2025 has expired; Q1 2026 reflects $63,630 of net Sponsor fee expense, a structural change from Q1 2025 when the waiver produced zero net expense. The filing discusses custodial concentration risk (two custodians), regulatory uncertainty around ETH's commodity vs. security classification, and forced liquidation scenarios if regulatory developments compel dissolution — all of which are qualitative factors relevant to any liquidation scenario but are not separately XBRL-tagged.
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