TLDR:

Grayscale introduced the Ethereum Covered Call ETF (ETCO), designed to generate income using an options-based strategy.
The ETF distributes income twice a month on the 15th and 30th, targeting investors seeking consistent cash flow.
ETCO does not hold Ethereum directly but uses options tied to exchange-traded products that track Ether’s price.
The fund joins Grayscale’s income-focused lineup, including its Bitcoin Covered Call ETF (BTCC) and Premium Income ETF (BPI).

Grayscale has launched a new exchange-traded fund aimed at crypto investors seeking regular income. The product focuses on Ethereum exposure while distributing cash flow on a biweekly basis. It uses a covered call approach instead of direct token holdings. 

The move adds another option to Grayscale’s lineup of income-focused products. Industry watchers say the design signals a push to meet different investor goals.

Grayscale Ethereum Covered Call ETF Targets Income Generation

The new Grayscale Ethereum Covered Call ETF will trade under the ticker ETCO. In its announcement, the company described the fund as an income-first strategy. It aims to collect premiums from options while offering exposure to Ether’s price movement.

The strategy works by writing call options near current prices. According to Grayscale, the premiums provide a source of income while also cushioning declines. That income is set for distribution twice monthly, on the 15th and 30th.

Introducing the Grayscale Ethereum Covered Call ETF (ticker: $ETCO), strategically designed to maximize potential income generation on Ether exposure and distribute dividends biweekly.

See important disclosures or learn more here https://t.co/ckGhjxi8qi pic.twitter.com/OzSgKisSHH

— Grayscale (@Grayscale) September 4, 2025

Unlike traditional ETFs, ETCO does not invest directly in Ethereum. Instead, it uses derivatives tied to exchange-traded products that track Ether. These include the Grayscale Ethereum Trust ETF (ETHE) and the Ethereum Mini Trust ETF (ETH).

Krista Lynch, Senior Vice President of ETF Capital Markets at Grayscale, said the product was built to fit different investor needs. She noted it complements existing ETH exposure while adding a steady income component.

Crypto Investors See Biweekly Payouts From New Fund

ETCO’s design reflects the growing interest in structured yield strategies around crypto. The systematic call writing approach offers potential cash flow without requiring investors to trade options themselves. By outsourcing the process, investors gain managed exposure to Ethereum’s volatility while receiving dividends.

The fund is fully options-based and actively managed. Grayscale confirmed there is no guarantee of outcomes, but its method is focused on consistent distribution. By collecting option premiums, the ETF intends to provide cash flow regardless of short-term price swings.

Wu Blockchain highlighted that ETCO joins an expanding suite of income products under Grayscale. These already include the Grayscale Bitcoin Covered Call ETF (BTCC) and the Grayscale Premium Income ETF (BPI). The firm says the new launch supports its broader platform for digital asset investors.

Grayscale announced the launch of the Grayscale Ethereum Covered Call ETF (ticker: ETCO). The fund employs a systematic covered call strategy and offers fixed distributions twice a month (on the 15th and 30th), but does not invest directly in Ethereum, instead gaining indirect…

— Wu Blockchain (@WuBlockchain) September 4, 2025

The fund’s structure may appeal to those seeking high-yield opportunities tied to crypto markets. With regular income payments, ETCO targets investors balancing price exposure with steady distributions.

The post Grayscale Rolls Out Ethereum Covered Call ETF Targeting Biweekly Income appeared first on Blockonomi.

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Filed under: Bitcoin - @ September 4, 2025 11:26 pm