<DOCUMENT>
<TYPE>TEXT-EXTRACT
<SEQUENCE>2
<FILENAME>filename2.txt
<TEXT>
United States securities and exchange commission logo





                              June 2, 2020

       Barry Silbert
       Chief Executive Officer
       Grayscale Investments, LLC
       250 Park Avenue South
       New York, NY 10003

                                                        Re: Grayscale Ethereum
Trust (ETH)
                                                            Draft Registration
Statement on Form 10-12G
                                                            Submitted April 17,
2020
                                                            CIK No. 0001725210

       Dear Mr. Silbert:

              We have reviewed your draft registration statement and have the
following comments. In
       some of our comments, we may ask you to provide us with information so
we may better
       understand your disclosure.

              Please respond to this letter by providing the requested
information and either submitting
       an amended draft registration statement or publicly filing your
registration statement on
       EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
       believe an amendment is appropriate, please tell us why in your
response.

             After reviewing the information you provide in response to these
comments and your
       amended draft registration statement or filed registration statement, we
may have additional
       comments.

       Draft Registration Statement on Form 10-12G

       Cover Page

   1.                                                   We note your disclosure
on the cover page and throughout the information statement that
                                                        the "investment
objective of the Trust is for the Shares (based on ETH per Share) to
                                                        reflect the value of
ETH held by the Trust, as determined by reference to the Index
                                                        Price..., less the
Trust's expenses and other liabilities." However, we also note that your
                                                        Shares trade at, and
have historically traded at, a substantial premium over the Digital
                                                        Asset Holdings per
Share. Please revise the cover page to disclose that an investment in
                                                        the Shares does not
constitute a direct investment in ETH. Please also revise the cover
                                                        page to disclose that
the Shares have traded at a substantial premium over the Digital
                                                        Asset Holdings per
Share and that the Trust has been unable to meet its investment
 Barry Silbert
FirstNameInvestments, LLC
Grayscale LastNameBarry Silbert
Comapany NameGrayscale Investments, LLC
June 2, 2020
Page 2
June 2, 2020 Page 2
FirstName LastName
         objective and may be unable to do so for the foreseeable future.
Please also add
         prominent Risk Factor disclosure regarding the same and make
corresponding revisions
         throughout wherever you describe the Trust's investment objective,
purpose or design.
Summary, page 4

2.       Please consider including a recent developments section in the
Summary, as applicable, to
         address any recent events having a material impact on the Trust or an
investment in the
         Trust.
3.       Please revise your Summary to disclose that the Shares have been
trading at a substantial
         premium in recent periods and quantify the extent thereof.
4.       We note your disclosure that, at this time, the Sponsor is not
operating a redemption
         program for the Shares. We further note your disclosure that the value
of the Shares may
         not reflect the value of the Trust's Digital Asset Holdings per Share
because the Trust
         does not currently operate a redemption program and may, from time to
time, halt Share
         creations. Please revise to explain why you are not operating a
redemption program.
         Please revise to clarify how the lack of a redemption program affects
the value of the
         Shares. In addition, please revise to clarify whether you intend to
operate a redemption
         program in the future. To the extent you intend to operate a
redemption program in the
         future, please revise to explain the impact that a redemption program
will have on the
         value at which the Shares trade as compared to the value at which they
trade without a
         redemption program and as compared to the value of ETH held by the
Trust. Please also
         explain the circumstances under which you would halt creations.
5.       We note your disclosure in the Summary section that the value of the
Shares may not
         reflect the value of the Trust's Digital Asset Holdings per Share
because the Trust does
         not currently operate a redemption program and may, from time to time,
halt Share
         creations. We also note your disclosure elsewhere that the value of
the Shares may not
         approximate the value of the Trust's Digital Asset Holdings per Share
due to:

              price volatility, trading volume and closings of Digital Asset
Exchanges due to fraud,
              failure, security breaches or otherwise, as disclosed on the
cover page;
              the holding period under Rule 144, as disclosed on page 24; and
              the non-current trading hours between OTCQX and the Digital Asset
Exchange
              Market, as disclosed on page 25.

         Please revise throughout to clearly and consistently explain why the
Shares trade at a
         substantial premium over the value of the Trust's Digital Asset
Holdings per Share.
Risk Factors, page 9

6.       Please revise your Risk Factor disclosure to address the specific
impact of current events
         on the Trust. In addition, and as applicable, please update your
hypothetical disclosures in
         light of such events and explain how they could affect an investment
in the Shares.
 Barry Silbert
FirstNameInvestments, LLC
Grayscale LastNameBarry Silbert
Comapany NameGrayscale Investments, LLC
June 2, 2020
Page 3
June 2, 2020 Page 3
FirstName LastName
7.       Please revise to include a risk factor that describes the effect on
investors who purchase in
         the secondary market of the Shares trading at a substantial premium
over the Digital Asset
         Holdings per Share.
Digital assets such as ETH were only introduced within the past decade...
Digital assets represent a new and rapidly evolving industry..., page 9

8.       We note that some of the bullet points in these risk factors appear to
present distinct risks
         that should be addressed in separate risk factors. To the extent any
bullets present distinct
         material risks, please break them out into separate risk factors
specifically discussing their
         risk to your business.
The Trust faces risks related to the novel coronavirus (COVID-19) outbreak...,
page 18

9.       We note your disclosure under this heading regarding the impact of
COVID-19 on global
         financial markets in both the short and long term. In this regard, we
note your disclosure
         that:

              while the magnitude of the impact of the COVID-19 outbreak on the
Trust's digital
              assets remains uncertain, the "continued spread of COVID-19 and
the imposition of
              related public health measures . . . have resulted in, and will
continue to result in,
              increased volatility and uncertainty in the Digital Asset
Markets;" and
              you rely on third party service providers to perform certain
functions essential to the
              operation of the Trust, and any disruptions related to the
COVID-19 outbreak "could
              have an adverse impact on the Trust's ability to access critical
services and would be
              disruptive to the operation of the Trust."

         Please revise to address any material impact COVID-19 has had upon the
demand for
         digital assets generally, as well as the value of, and demand for, the
digital assets held by
         the Trust. Please also disclose any known or reasonably likely effects
of COVID-19 upon
         the operations of the Trust, the Sponsor and any third party service
providers.
The Index Price used to calculate the value of the Trust's ETH may be
volatile..., page 20

10.      Please revise this risk factor to provide illustrative examples
regarding the volatility of the
         Index Price, and the price of ETH generally, in recent periods.
Description of the Shares
Recent Sales of Unregistered Shares, page 79

11.      Please provide us your analysis of the facts and circumstances as
relevant to ascertain
         whether the private placement investors purchased the Shares with
investment intent and
         not a view to distribute. In this regard, please tell us any factors
that you considered in
         determining the investment intent of the purchasers, in addition to
obtaining a written
         representation regarding investment intent. Please also tell us the
nature of any material
         relationships which the investors had with the registrant either in
connection with or in
 Barry Silbert
Grayscale Investments, LLC
June 2, 2020
Page 4
         addition to the private placements. Please tell us how many Shares
continue to be held by
         the original private placement investors and, for those Shares that
have been transferred,
         describe any steps the Trust or the Sponsor engaged in to ensure the
transfers were done in
         compliance with the federal securities laws.
Transfer Restrictions, page 81

12.      We note your disclosure that after the Trust has been subject to the
reporting requirements
         of Section 13 under the Exchange Act for a period of 90 days, the
minimum holding
         period under Rule 144 will be reduced from one year to six months.
Please revise your
         disclosure throughout the document as appropriate to explain the
effects of a shortened
         holding period.
Certain U.S. Federal Income Tax Consequences, page 105

13.      We understand that your tax status as a grantor trust is dependent on
the trust holding a
         single asset at the time of share creations. Please confirm that our
understanding is
         correct, tell us whether any digital assets created via forks or
airdrops have been disposed
         of via your prospective abandonment notice and also address the
following:

              Confirm that any digital assets created via forks and airdrops
that have not been
              distributed to shareholders did not have significant value at the
time the fork or
              airdrop occurred and do not currently hold significant value.

              Clarify for us whether it is your position that issuing a
prospective abandonment
              notice for digital assets received via forks or airdrops is
sufficient to protect your tax
              status as a grantor trust.

              Confirm that your historical financial statements would not be
materially different if
              in fact use of your prospective abandonment notice to dispose of
digital assets did not
              meet the derecognition requirements of US GAAP.

       You may contact John Spitz, Staff Accountant, at (202) 551-3484 or
Michael Volley,
Staff Accountant, at (202) 551-3437 if you have questions regarding comments on
the financial
statements and related matters. Please contact David Lin, Staff Attorney, at
(202) 551-3552 or
Sandra Hunter Berkheimer, Legal Branch Chief, at (202) 551-3758 with any other
questions.



FirstName LastNameBarry Silbert                                   Sincerely,
Comapany NameGrayscale Investments, LLC
                                                                  Division of
Corporation Finance
June 2, 2020 Page 4                                               Office of
Finance
FirstName LastName
</TEXT>
</DOCUMENT>
