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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-42165

Invesco Galaxy Ethereum ETF

(Exact name of registrant as specified in its charter)

Delaware |  | 93-6866177
(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification No.)
c/o Invesco Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, Illinois |  | 60515
(Address of Principal Executive Offices) |  | (Zip Code)

Registrant’s telephone number, including area code: (800) 983-0903

Securities registered pursuant to Section 12(b) of the Act:

Title of each class | Trading Symbol(s) | Name of each exchange on which registered
Common Shares of Beneficial Interest | QETH | Cboe BZX Exchange, Inc.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer | ☐ |  | Accelerated Filer | ☐
Non-Accelerated Filer | ☒ |  | Smaller reporting company | ☒
|  |  | Emerging growth company | ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of outstanding Shares as of September 30, 2025: 943,000

INVESCO GALAXY ETHEREUM ETF

QUARTER ENDED SEPTEMBER 30, 2025

TABLE OF CONTENTS

|  |  |  |  |  | Page
PART I. |  | FINANCIAL INFORMATION |  | 1
|  | ITEM 1. |  | Financial Statements |  | 1
|  |  |  | Notes to Unaudited Financial Statements |  | 8
|  | ITEM 2. |  | Management’s Discussion and Analysis of Financial Condition and Results of Operations |  | 16
|  | ITEM 3. |  | Quantitative and Qualitative Disclosures About Market Risk |  | 21
|  | ITEM 4. |  | Controls and Procedures |  | 21
PART II. |  | OTHER INFORMATION |  | 21
|  | Item 1. |  | Legal Proceedings |  | 21
|  | Item 1A. |  | Risk Factors |  | 21
|  | Item 2. |  | Unregistered Sales of Equity Securities and Use of Proceeds |  | 22
|  | Item 3. |  | Defaults Upon Senior Securities |  | 22
|  | Item 4. |  | Mine Safety Disclosures |  | 22
|  | Item 5. |  | Other Information |  | 22
|  | Item 6. |  | Exhibits |  | 23
SIGNATURES |  | 24

i

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

Invesco Galaxy Ethereum ETF

Statements of Financial Condition

September 30, 2025 and December 31, 2024

(Unaudited)

|  | September 30, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
Assets |  |  |  |  |  |
Investments in Ether, at value (cost $26,555,707 and $19,846,885, respectively) |  | $ | 38,997,371 |  |  | $ | 23,569,250 |
Total Assets |  | $ | 38,997,371 |  |  | $ | 23,569,250 |
Liabilities |  |  |  |  |  |
Payable for: |  |  |  |  |  |
Accrued Sponsor’s fee |  | $ | 7,512 |  |  | $ | 5,997 |
Total Liabilities |  |  | 7,512 |  |  |  | 5,997 |
Commitments and Contingencies (Note 9) |  |  |  |  |  |
Net Assets |  | $ | 38,989,859 |  |  | $ | 23,563,253 |
Net assets consist of: |  |  |  |  |  |
Paid-in-capital |  | $ | 26,647,753 |  |  | $ | 19,469,136 |
Distributable earnings (loss) |  |  | 12,342,106 |  |  |  | 4,094,117 |
|  | $ | 38,989,859 |  |  | $ | 23,563,253 |
Shares outstanding |  |  | 943,000 |  |  |  | 708,000 |
Net asset value per share |  | $ | 41.35 |  |  | $ | 33.28 |
Market value per share |  | $ | 41.48 |  |  | $ | 33.39 |

See accompanying Notes to Unaudited Financial Statements which are an integral part of the financial statements.

1

Invesco Galaxy Ethereum ETF

Schedule of Investments

September 30, 2025

(Unaudited)

Description |  | Quantity |  |  | Cost |  |  | Fair Value |  |  | % of Net Assets |
Cryptocurrency |  |  |  |  |  |  |  |  |  |  |  |
Ether |  |  | 9,403 |  |  | $ | 26,555,707 |  |  | $ | 38,997,371 |  |  |  | 100.02 | %
Total Investments |  |  | 9,403 |  |  | $ | 26,555,707 |  |  | $ | 38,997,371 |  |  |  | 100.02 | %
Other Assets Less Liabilities |  |  |  |  |  |  |  | $ | (7,512 | ) |  |  | (0.02 | )%
Net assets |  |  |  |  |  |  |  | $ | 38,989,859 |  |  |  | 100.00 | %

See accompanying Notes to Unaudited Financial Statements which are an integral part of the financial statements.

2

Invesco Galaxy Ethereum ETF

Schedule of Investments

December 31, 2024

(Unaudited)

Description |  | Quantity |  |  | Cost |  |  | Fair Value |  |  | % of Net Assets |
Cryptocurrency |  |  |  |  |  |  |  |  |  |  |  |
Ether |  |  | 7,074 |  |  | $ | 19,846,885 |  |  | $ | 23,569,250 |  |  |  | 100.03 | %
Total Investments |  |  | 7,074 |  |  | $ | 19,846,885 |  |  | $ | 23,569,250 |  |  |  | 100.03 | %
Other Assets Less Liabilities |  |  |  |  |  |  |  | $ | (5,997 | ) |  |  | (0.03 | )%
Net assets |  |  |  |  |  |  |  | $ | 23,563,253 |  |  |  | 100.00 | %

See accompanying Notes to Unaudited Financial Statements which are an integral part of the financial statements.

3

Invesco Galaxy Ethereum ETF

Statements of Income and Expenses

For the Three Months Ended September 30, 2025 and 2024, the Nine Months Ended September 2025,

and the Period June 17, 2024 to September 30, 2024

(Unaudited)

|  | Three Months Ended |  |  | Nine Months Ended |  |  | For the Period June 17, 2024 to |
|  | September 30, |  |  | September 30, |  |  | September 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Income |  |  |  |  |  |  |  |  |  |  |  |
Total Income |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Expenses |  |  |  |  |  |  |  |  |  |  |  |
Sponsor fee |  |  | 21,832 |  |  |  | 5,976 |  |  |  | 45,871 |  |  |  | 5,976 |
Total Expenses |  |  | 21,832 |  |  |  | 5,976 |  |  |  | 45,871 |  |  |  | 5,976 |
Net Investment Income (Loss) |  |  | (21,832 | ) |  |  | (5,976 | ) |  |  | (45,871 | ) |  |  | (5,976 | )
Net Realized and Net Change in Unrealized Gain (Loss) |  |  |  |  |  |  |  |  |  |  |  |
Net Realized Gain (Loss) from |  |  |  |  |  |  |  |  |  |  |  |
Investments in Ether Sold to Pay Sponsor Fee |  |  | (1,438 | ) |  |  | (1,455 | ) |  |  | (9,240 | ) |  |  | (1,455 | )
Investments in Ether Sold for Redemptions |  |  | 437,856 |  |  |  | — |  |  |  | (416,199 | ) |  |  | — |
Net Realized Gain (Loss) |  |  | 436,418 |  |  |  | (1,455 | ) |  |  | (425,439 | ) |  |  | (1,455 | )
Net Change in Unrealized Gain (Loss) from Investments in Ether |  |  | 13,721,224 |  |  |  | (3,514,876 | ) |  |  | 8,719,299 |  |  |  | (3,514,876 | )
Net Realized and Net Change in Unrealized Gain (Loss) from Investments in Ether |  |  | 14,157,642 |  |  |  | (3,516,331 | ) |  |  | 8,293,860 |  |  |  | (3,516,331 | )
Net Income (Loss) |  | $ | 14,135,810 |  |  | $ | (3,522,307 | ) |  | $ | 8,247,989 |  |  | $ | (3,522,307 | )

See accompanying Notes to Unaudited Financial Statements which are an integral part of the financial statements.

4

Invesco Galaxy Ethereum ETF

Statement of Changes in Shareholders’ Equity

For the Three Months Ended September 30, 2025 and 2024

(Unaudited)

|  |  |  |  | Total |
|  | Shares |  |  | Shareholders' Equity |
Balance at June 30, 2025 |  |  | 913,000 |  |  | $ | 22,649,742 |
Purchases of Shares |  |  | 660,000 |  |  |  | 26,961,783 |
Redemption of Shares |  |  | (630,000 | ) |  |  | (24,757,476 | )
Net Increase (Decrease) due to Share Transactions |  |  | 30,000 |  |  |  | 2,204,307 |
Net Income (Loss) |  |  |  |  |  |
Net Investment Income (Loss) |  |  |  |  |  | (21,832 | )
Net Realized Gain (Loss) from Investments in Ether Sold for Sponsor Fee and Redemptions |  |  |  |  |  | 436,418 |
Net Change in Unrealized Gain (Loss) from Investments in Ether |  |  |  |  |  | 13,721,224 |
Net Income (Loss) |  |  |  |  |  | 14,135,810 |
Net Change in Shareholders' Equity |  |  | 30,000 |  |  |  | 16,340,117 |
Balance at September 30, 2025 |  |  | 943,000 |  |  | $ | 38,989,859 |

|  |  |  |  | Total |
|  | Shares |  |  | Shareholders' Equity |
Balance at June 30, 2024 |  |  | 4,000 |  |  | $ | 100,000 |
Purchases of Shares |  |  | 783,000 |  |  |  | 23,895,890 |
Redemption of Shares |  |  | (4,000 | ) |  |  | (100,000 | )
Net Increase (Decrease) due to Share Transactions |  |  | 779,000 |  |  |  | 23,795,890 |
Net Income (Loss) |  |  |  |  |  |
Net Investment Income (Loss) |  |  |  |  |  | (5,976 | )
Net Realized Gain (Loss) from Investments in Ether Sold for Sponsor Fee and Redemptions |  |  |  |  |  | (1,455 | )
Net Change in Unrealized Gain (Loss) from Investments in Ether |  |  |  |  |  | (3,514,876 | )
Net Income (Loss) |  |  |  |  |  | (3,522,307 | )
Net Change in Shareholders' Equity |  |  | 779,000 |  |  |  | 20,273,583 |
Balance at September 30, 2024 |  |  | 783,000 |  |  | $ | 20,373,583 |

See accompanying Notes to Unaudited Financial Statements which are an integral part of the financial statements.

5

Invesco Galaxy Ethereum ETF

Statement of Changes in Shareholders’ Equity

For the Nine Months Ended September 30, 2025 and

the Period June 17, 2024 to September 30, 2024

(Unaudited)

|  |  |  |  | Total |
|  | Shares |  |  | Shareholders' Equity |
Balance at December 31, 2024 |  |  | 708,000 |  |  | $ | 23,563,253 |
Purchases of Shares |  |  | 935,000 |  |  |  | 33,387,002 |
Redemption of Shares |  |  | (700,000 | ) |  |  | (26,208,385 | )
Net Increase (Decrease) due to Share Transactions |  |  | 235,000 |  |  |  | 7,178,617 |
Net Income (Loss) |  |  |  |  |  |
Net Investment Income (Loss) |  |  |  |  |  | (45,871 | )
Net Realized Gain (Loss) from Investments in Ether Sold for Sponsor Fee and Redemptions |  |  |  |  |  | (425,439 | )
Net Change in Unrealized Gain (Loss) from Investments in Ether |  |  |  |  |  | 8,719,299 |
Net Income (Loss) |  |  |  |  |  | 8,247,989 |
Net Change in Shareholders' Equity |  |  | 235,000 |  |  |  | 15,426,606 |
Balance at September 30, 2025 |  |  | 943,000 |  |  | $ | 38,989,859 |

|  |  |  |  | Total |
|  | Shares |  |  | Shareholders' Equity |
Balance at June 17, 2024 |  |  | — |  |  | $ | — |
Purchases of Shares |  |  | 787,000 |  |  |  | 23,995,890 |
Redemption of Shares |  |  | (4,000 | ) |  |  | (100,000 | )
Net Increase (Decrease) due to Share Transactions |  |  | 783,000 |  |  |  | 23,895,890 |
Net Income (Loss) |  |  |  |  |  |
Net Investment Income (Loss) |  |  |  |  |  | (5,976 | )
Net Realized Gain (Loss) from Investments in Ether Sold for Sponsor Fee and Redemptions |  |  |  |  |  | (1,455 | )
Net Change in Unrealized Gain (Loss) from Investments in Ether |  |  |  |  |  | (3,514,876 | )
Net Income (Loss) |  |  |  |  |  | (3,522,307 | )
Net Change in Shareholders' Equity |  |  | 783,000 |  |  |  | 20,373,583 |
Balance at September 30, 2024 |  |  | 783,000 |  |  | $ | 20,373,583 |

See accompanying Notes to Unaudited Financial Statements which are an integral part of the financial statements.

6

Invesco Galaxy Ethereum ETF

Statement of Cash Flows

For the Nine Months Ended September 30, 2025 and the Period June 17, 2024 to September 30, 2024

(Unaudited)

|  | 2025 |  |  | 2024 |
Cash flows from operating activities: |  |  |  |  |  |
Net Income (Loss) |  | $ | 8,247,989 |  |  | $ | (3,522,307 | )
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |  |  |  |  |  |
Cost of ether purchased |  |  | (33,385,860 | ) |  |  | (23,895,889 | )
Proceeds from ether sold to pay Sponsor Fee |  |  | 44,355 |  |  |  | 3,378 |
Proceeds from ether sold for Redemptions |  |  | 26,207,244 |  |  |  | — |
Net Realized (Gain) Loss from Investments in Ether Sold to pay Sponsor Fee |  |  | 9,240 |  |  |  | 1,455 |
Net Realized (Gain) Loss from Investments in Ether Sold for Redemptions |  |  | 416,199 |  |  |  | — |
Net Change in Unrealized (Gain) Loss from Investments in Ether |  |  | (8,719,299 | ) |  |  | 3,514,876 |
Change in operating assets and liabilities: |  |  |  |  |  |
Accrued Sponsor's fees |  |  | 1,515 |  |  |  | 2,597 |
Net cash provided by (used in) operating activities |  |  | (7,178,617 | ) |  |  | (23,895,890 | )
Cash flows from financing activities: |  |  |  |  |  |
Proceeds from purchases of Shares |  |  | 33,387,002 |  |  |  | 23,995,890 |
Redemption of Shares |  |  | (26,208,385 | ) |  |  | (100,000 | )
Net cash provided by (used in) financing activities |  |  | 7,178,617 |  |  |  | 23,895,890 |
Net change in cash |  |  | — |  |  |  | — |
Cash at beginning of period |  |  | — |  |  |  | — |
Cash at end of period |  | $ | — |  |  | $ | — |

See accompanying Notes to Unaudited Financial Statements which are an integral part of the financial statements.

7

Invesco Galaxy Ethereum ETF

Notes to Unaudited Financial Statements

September 30, 2025

Note 1 – Organization

Invesco Galaxy Ethereum ETF (the “Trust”) is a Delaware statutory trust formed on September 27, 2023, pursuant to the Delaware Statutory Trust Act (“DSTA”). The Trust continuously issues common shares representing fractional undivided beneficial interest in and ownership of the Trust (“Shares”). The Trust operates pursuant to its Second Amended and Restated Declaration of Trust and Trust Agreement, dated as of June 21, 2024 (the “Trust Agreement”). CSC Delaware Trust Company, a Delaware trust company, is the Delaware trustee of the Trust (the “Trustee”). The Trust is managed and controlled by Invesco Capital Management LLC (the “Sponsor”).

The Trust offers Shares only to certain eligible financial institutions (“Authorized Participants”) in one or more blocks of 5,000 Shares (“Creation Baskets”) based on the quantity of ether attributable to each Share of the Trust. The Trust has an unlimited number of shares authorized for issuance.

On June 17, 2024, Invesco Ltd., subject to certain conditions, purchased 4,000 Shares (the “Initial Seed Shares”) in exchange for $100,000, which comprised the initial purchase of the Trust’s Shares. Delivery of the Shares was made on June 17, 2024. On July 9, 2024, Invesco Ltd. redeemed all of its Initial Seed Shares for cash at a per-Share price of $25.00 for a total redemption value of $100,000. At the same time on July 9, 2024, Invesco Ltd. created 3,000 shares at a price of $30.042 per Share based on the Lukka Prime Ethereum Reference Rate (the “Benchmark”) price as of 4:00 p.m. Eastern Time on July 8, 2024. The Benchmark is designed to provide an estimated fair market value price for ether, based on the execution price of ether on its principal market. The price of the Shares acquired by the Invesco Ltd. was determined based on the price of the Benchmark. On July 24, 2024, Invesco Ltd. sold all of its Shares.

Effective July 22, 2024, the Trust’s registration statement was declared effective by the U.S. Securities and Exchange Commission (the “SEC”). The Trust commenced trading on the Cboe BZX Exchange, Inc. (the “Exchange”) on July 23, 2024.

The Trust’s investment objective is to reflect the performance of the spot price of ether as measured using the Benchmark, less the Trust’s expenses and other liabilities. In seeking to achieve its investment objective, the Trust will hold ether. Coinbase Custody Trust Company, LLC (the “Ethereum Custodian”) will hold all of the Trust’s ether on the Trust’s behalf as Ethereum Custodian.

The Bank of New York Mellon (“BNYM”), the Trust's “Administrator,” calculates, and the Sponsor publishes, the Trust's Net Asset Value (“NAV”) once each business day. To calculate the NAV, the Administrator totals the current market value of ether in the Trust and any other assets, and subtracts any liabilities including accrued but unpaid expenses. The Trust's NAV is an amount denominated in U.S. dollars.

This Quarterly Report (the “Report”) covers the three and nine months ended September 30, 2025, the three months ended September 30, 2024 and the period June 17, 2024 to September 30, 2024. The accompanying unaudited financial statements were prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q and the rules and regulations of the SEC. In the opinion of management, all material adjustments, consisting only of normal recurring adjustments, considered necessary for a fair statement of the interim period financial statements have been made. Interim period results are not necessarily indicative of results for a full-year period. These financial statements and the notes thereto should be read in conjunction with the Trust’s financial statements included in its Annual Report on Form 10-K for the period ended December 31, 2024, as filed with the SEC on February 28, 2025.

Note 2 – Summary of Significant Accounting Policies

A.
Basis of Presentation

The financial statements of the Trust have been prepared using U.S. GAAP. The Trust is considered an investment company under U.S. GAAP for financial statement purposes and follows the accounting and reporting guidance applicable to investment companies in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946, Financial Services— Investment Companies, but is not registered, and is not required to be registered, under the Investment Company Act of 1940, as amended.

B.
Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. In addition, the Trust monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are issued.

8

C. Segment Reporting

The Trust represents a single operating segment. Subject to the oversight and, when applicable, approval of the Board of Managers, the Trust's Sponsor acts as the Trust's chief operating decision maker (“CODM”), assessing performance and making decisions about resource allocation within the Trust. The CODM monitors the operating results as a whole and the Trust's long-term strategic asset allocation is determined in accordance with the terms of its prospectus based on a defined investment strategy. The financial information provided to and reviewed by the CODM is consistent with that presented in the Trust's financial statements.

D.
Cash and Cash Equivalents

The Trust defines cash as cash held by the Cash Custodian (as defined below). There were no cash equivalents held by the Trust as of September 30, 2025 and December 31, 2024.

E.
Investment Valuations

The Trust applies FASB ASC Topic 820, Fair Value Measurement, in the valuation of ether held by the Trust and for financial statement purposes. The fair market value price for ether reflects the price that would be received for ether in a current sale, which assumes an orderly transaction between market participants on the measurement date of ether on its “principal market,” generally, the most advantageous market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Trust determines its principal market (or in the absence of a principal market the most advantageous market) on a periodic basis to determine which market is its Principal Market for the purpose of calculating fair value for the creation of quarterly and annual financial statements. Issuer-specific events, market trends, bid/asked quotes of brokers and information providers and other data may be reviewed in the course of making a good faith determination of a security’s fair value.

F.
Investment Transactions

Ether transactions are accounted for on a trade date basis. Realized gains or losses from the sale or disposition of ether are determined on a specific identification basis and recognized in the Statements of Income and Expenses in the period in which the sale or disposition occurs, respectively.

G.
Routine Operational, Administrative and Other Ordinary Expenses

The Sponsor is responsible for all routine operational, administrative and other ordinary expenses of the Trust, including, but not limited to, the Trustee’s fees, the fees of the BNYM (the Administrator and the “Transfer Agent”) (for its services as the Administrator, Transfer Agent, and Cash Custodian (defined herein)), the fees of the Ethereum Custodian, the fees of Galaxy Digital Funds LLC (the “Execution Agent”), Exchange listing fees, SEC registration fees, printing and mailing costs, legal costs and audit fees. The Trust does not reimburse the Sponsor for the routine operational, administrative and other ordinary expenses of the Trust. Accordingly, such expenses are not reflected in the Statements of Income and Expense of the Trust.

H.
Non-Recurring Fees and Expenses

In certain cases, the Trust will pay for some expenses in addition to the Sponsor Fee (defined herein). These exceptions include expenses not assumed by the Sponsor (i.e., expenses other than those identified in Section G of this Note 2), litigation and indemnification expenses, judgments, transactional expenses, taxes and other expenses not expected to be incurred in the ordinary course of the Trust’s business. The only expenses of the Trust during the three and nine months ended September 30, 2025, the three months ended September 30, 2024 and the period June 17, 2024 to September 30, 2024 were the Sponsor Fee.

I.
Federal Income Taxes

The Sponsor intends to take the position that the Trust is properly treated as a grantor trust for U.S. federal income tax purposes. Assuming that the Trust is a grantor trust, the Trust will not be subject to U.S. federal income tax and, therefore, no provision for federal income taxes is required. Rather, if the Trust is a grantor trust, each beneficial owner of Shares will be treated as directly

9

owning its pro rata share of the Trust’s assets and a pro rata portion of the Trust’s income, gain, losses and deductions will “flow through” to each beneficial owner of Shares.

Note 3 – Concentration Risk

Unlike other funds that may invest in diversified assets, the Trust’s investment strategy is concentrated in a single asset: ether. This concentration maximizes the degree of the Trust’s exposure to a variety of market risks associated with ether, including the rise or fall in its price, sometimes rapidly or unexpectedly. By concentrating its investment strategy solely in ether, any losses suffered as a result of a decrease in the value of ether can be expected to reduce the value of an interest in the Trust and will not be offset by other gains if the Trust were to invest in underlying assets that were diversified. There is no assurance that ether will maintain its long-term value in terms of purchasing power in the future. In the event that the price of ether declines, the Sponsor expects the value of an investment in the Shares to decline proportionately. Each of these events could have a material effect on the Trust’s financial position and the results of its operations.

Note 4 – Service Providers and Related Party Agreements

The Trustee

CSC Delaware Trust Company, a Delaware trust company, acts as the Trustee of the Trust as required to create a Delaware statutory trust in accordance with the Trust Agreement and the DSTA. Under the Trust Agreement, the duties of the Trustee are limited to (i) accepting legal process served on the Trust in the State of Delaware and (ii) at the direction of the Sponsor, the execution of any certificates required to be filed with the Secretary of State of the State of Delaware which the Trustee is required to execute under the DSTA.

The Sponsor

Invesco Capital Management LLC is the Sponsor of the Trust. The Sponsor arranged for the creation of the Trust and is responsible for the ongoing registration of the Shares for their public offering, the listing of Shares on the Exchange and valuing the ether held by the Trust. The Sponsor is a limited liability company formed in the state of Delaware on February 7, 2003, and is a wholly-owned subsidiary of Invesco Ltd. Invesco Ltd. and its subsidiaries, including the Sponsor, are an independent global investment management group.

The Trust pays the Sponsor a unified fee (the “Sponsor Fee”) in an amount equal to 0.25% per annum of the daily total net assets of the Trust as compensation for services performed under the Trust Agreement. The Sponsor Fee is accrued daily and paid monthly in arrears on the first day the Exchange is open for regular trading (a “Business Day”) of the month in U.S. dollars, and is calculated by the Administrator. The Sponsor also paid the costs of the Trust’s organization.

To cover the Sponsor Fee, and extraordinary expenses not assumed by the Sponsor, the Sponsor or its delegate will cause the Trust (or its delegate) to instruct the Execution Agent to convert ether held by the Trust into U.S. dollars. Extraordinary expenses include, but are not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, Ethereum network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders (including, for example, in connection with any fork of the Ethereum blockchain), any indemnification of the Sponsor, Cash Custodian, Ethereum Custodian, Administrator or other agents, service providers or counterparties of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters. The NAV of the Trust and the number of ether represented by a Share will decline each time the Trust accrues the Sponsor Fee or any Trust expenses not assumed by the Sponsor. The Trust is not responsible for paying any costs associated with the transfer of ether to or from the Trust in connection with paying the Sponsor Fee or in connection with creation and redemption transactions.

The Administrator

BNYM serves as the Trust’s Administrator. Under the trust administration and accounting agreement, the Administrator provides necessary administrative, tax and accounting services and financial reporting for the maintenance and operations of the Trust, including calculating the NAV of the Trust, determining the net assets of the Trust, and calculating the size of the creation baskets.

The Transfer Agent

BNYM also serves as the Transfer Agent for the Trust. The Transfer Agent is responsible for (1) issuing and redeeming Shares in connection with creation and redemption transactions, (2) responding to correspondence by Shareholders and others relating to its duties, (3) maintaining Shareholder accounts and (4) making periodic reports to the Trust.

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The Ethereum Custodian

Coinbase Custody Trust Company, LLC serves as the Trust’s Ethereum Custodian. Under the Ethereum Custody Agreement, the Ethereum Custodian is responsible for (1) safekeeping all of the ether owned by the Trust, (2) opening an account that holds the Trust’s ether and (3) facilitating the transfer of ether required for the operation of the Trust, as directed by the Sponsor. The Ethereum Custodian is chartered as a limited purpose trust company by the New York State Department of Financial Services (“NYSDFS”) and is authorized by the NYSDFS to provide digital asset custody services. The Ethereum Custodian is a wholly-owned subsidiary of Coinbase Global, Inc.

The Cash Custodian

BNYM serves as the Trust’s cash custodian (the “Cash Custodian”). Under the Cash Custody Agreement, the Cash Custodian is responsible for holding the Trust’s cash in connection with creation and redemption transactions effected in cash. The Cash Custodian is a New York state-chartered bank and a member of the Federal Reserve System.

The Marketing Agent

Invesco Distributors, Inc. (the “Marketing Agent”) is responsible for: (1) working with the Transfer Agent to review and approve, or reject, purchase and redemption orders of Creation Baskets placed by Authorized Participants with the Transfer Agent; and (2) reviewing and approving the marketing materials prepared by the Trust for compliance with applicable SEC and Financial Industry Regulatory Authority advertising laws, rules, and regulations.

The Execution Agent

The Sponsor has entered into an agreement with Galaxy Digital Funds LLC, a subsidiary of Galaxy Digital LP (“Galaxy”), to serve as Execution Agent. The Trust from time to time will be required to sell ether in such quantities as necessary to permit payment of the Sponsor Fee and any Trust expenses and liabilities not assumed by the Sponsor. The Sponsor has engaged the Execution Agent to sell ether on the Trust’s behalf in such circumstances. The Sponsor or its delegate will cause the Trust (or its delegate) to instruct the Execution Agent to sell ether at approximately the price at which it is valued by the Trust and in the smallest amounts required to permit such payments as they become due, with the intention of minimizing the Trust’s holdings of assets other than ether. Accordingly, the amount of ether to be sold may vary from time to time depending on the level of the Trust’s expenses and liabilities and the market price of ether. The Trust also may utilize the services of the Execution Agent to purchase or sell ether in connection with cash creations and redemptions. In addition, as part of this agreement, the Execution Agent has agreed to co-brand and co-market the Trust, and the Sponsor has licensed the use of certain Galaxy trademarks, service marks and trade names in connection with the Trust.

Galaxy is a subsidiary of Galaxy Digital Holdings LP (“Galaxy Holdings”). Galaxy Digital Holdings Ltd., which holds a limited partner interest in Galaxy Holdings, is listed on the Toronto Stock Exchange under the symbol “GLXY.”

Note 5 – Organization and Offering Costs

The Sponsor has agreed to pay the organizational and initial offering costs of the Trust and the Trust will not be obligated to reimburse the Sponsor. The organizational and initial offering costs include preparation and filing of incorporation documents, bylaws, declarations of trust, registration statements, board materials, state and federal registration of shares and audit fees. As a result, the Trust’s financial statements will not reflect these organizational and offering costs.

Note 6 – Additional Valuation Information

U.S. GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. U.S. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods or market conditions may result in transfers in or out of an investment’s assigned level:

Level 1: Prices are determined using quoted prices in an active market for identical assets.

Level 2: Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others.

Level 3: Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs

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may be used. Unobservable inputs reflect the Trust’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information.

As of September 30, 2025, the investments in this Trust were valued based on Level 1 inputs. The levels assigned to the investment valuations may not be an indication of the risk or liquidity associated with investing in those investments. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.

Note 7 – Investments in Ether

The Trust expects to purchase or sell ether in connection with cash creation or redemption transactions, and may sell ether to pay certain expenses, including the Sponsor Fee.

The following is a summary of the transactions in, and earnings from, investments in ether for the three and nine months ended September 30, 2025.

|  | Fair Value |
Opening Balance as of 06/30/2025 |  | $ | 22,654,462 |
Purchases at Cost |  |  | 26,960,641 |
Proceeds from Sales to Pay Sponsor Fee |  |  | (19,041 | )
Proceeds from ether sold for Redemptions |  |  | (24,756,333 | )
Change in Unrealized Appreciation (Depreciation) |  |  | 13,721,224 |
Net Realized (Gain) Loss from Investments in Ether Sold to pay Sponsor Fee |  |  | (1,438 | )
Net Realized (Gain) Loss from Investments in Ether Sold for Redemptions |  |  | 437,856 |
Ending Balance as of 09/30/2025 |  | $ | 38,997,371 |

|  | Fair Value |
Opening Balance as of 12/31/2024 |  | $ | 23,569,250 |
Purchases at Cost |  |  | 33,385,860 |
Proceeds from Sales to Pay Sponsor Fee |  |  | (44,355 | )
Proceeds from ether sold for Redemptions |  |  | (26,207,244 | )
Change in Unrealized Appreciation (Depreciation) |  |  | 8,719,299 |
Net Realized (Gain) Loss from Investments in Ether Sold to pay Sponsor Fee |  |  | (9,240 | )
Net Realized (Gain) Loss from Investments in Ether Sold for Redemptions |  |  | (416,199 | )
Ending Balance as of 09/30/2025 |  | $ | 38,997,371 |

The following is a summary of the transactions in, and earnings from, investments in ether for the three months ended September 30, 2024 and the period June 17, 2024 to September 30, 2024.

|  | Fair Value |
Opening Balance as of 06/30/2024 |  | $ | — |
Purchases at Cost |  |  | 23,895,889 |
Proceeds from Sales to Pay Sponsor Fee |  |  | (3,378 | )
Proceeds from ether sold for Redemptions |  |  | — |
Change in Unrealized Appreciation (Depreciation) |  |  | (3,514,876 | )
Net Realized (Gain) Loss from Investments in Ether Sold to pay Sponsor Fee |  |  | (1,455 | )
Net Realized (Gain) Loss from Investments in Ether Sold for Redemptions |  |  | — |
Ending Balance as of 09/30/2024 |  | $ | 20,376,180 |

|  | Fair Value |
Opening Balance as of 06/17/2024 |  | $ | — |
Purchases at Cost |  |  | 23,895,889 |
Proceeds from Sales to Pay Sponsor Fee |  |  | (3,378 | )
Proceeds from ether sold for Redemptions |  |  | — |
Change in Unrealized Appreciation (Depreciation) |  |  | (3,514,876 | )
Net Realized (Gain) Loss from Investments in Ether Sold to pay Sponsor Fee |  |  | (1,455 | )
Net Realized (Gain) Loss from Investments in Ether Sold for Redemptions |  |  | — |
Ending Balance as of 09/30/2024 |  | $ | 20,376,180 |

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Note 8 – Share Purchases and Redemptions

The Trust will process all creations and redemptions of Shares in transactions with Authorized Participants. When the Trust issues or redeems its Shares, it will do so only in Creation Baskets based on the quantity of ether attributable to each Share of the Trust (net of accrued but unpaid Sponsor fees and any accrued but unpaid expenses or liabilities). Creation and redemption transactions take place in cash, but in the future, the Trust may permit or require creation and redemption transactions to take place in-kind. Authorized Participants are the only persons that may place orders to create and redeem Creation Baskets. Authorized Participants must be (1) registered broker-dealers or other securities market participants, such as banks or other financial institutions, that are not required to register as broker-dealers to engage in securities transactions as described below, and (2) participants in DTC such as banks, dealers and trust companies (“DTC Participants”). To become an Authorized Participant, a person must enter into an Authorized Participant Agreement.

When purchasing Creation Baskets, Authorized Participants will deliver cash to the Cash Custodian. The Execution Agent will be responsible for acquiring the requisite amount of ether on behalf of the Trust on an agency basis. After receipt of the ether by the Ethereum Custodian, the Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.

When redeeming Creation Baskets, the Execution Agent will be responsible for selling the requisite amount of ether on behalf of the Trust on an agency basis. After receipt of the cash payment, the Transfer Agent will redeem the Shares and the Cash Custodian will distribute the resulting cash to the redeeming Authorized Participant in satisfaction of the redemption order.

Note 9 – Commitments and Contingencies

The Sponsor, either in its own capacity or in its capacity as the Sponsor and on behalf of the Trust, has entered into various service agreements that contain a variety of representations, or provide indemnification provisions related to certain risks service providers undertake in performing services for the Trust. The Trust’s organizational documents provide for the Trust to indemnify the Sponsor and any affiliate of the Sponsor that provides services to the Trust to the maximum extent permitted by applicable law, subject to certain exceptions for disqualifying conduct by the Sponsor or such an affiliate. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Further, the Trust has not had prior claims or losses pursuant to these contracts.

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Note 10 – Financial Highlights

The Trust is presenting the following NAV and financial highlights related to investment performance for a Share outstanding for the three and nine months ended September 30, 2025 and the period July 22, 2024 to September 30, 2024. An individual investor’s return and ratios may vary based on the timing of capital transactions.

NAV per Share is the NAV of the Trust divided by the number of outstanding Shares at the date of each respective period presented.

|  | Three Months Ended |  |  | Nine Months Ended |  |  | For the Period July 22, 2024 (the effective date of the Trust's registration statement) to |
|  | September 30, |  |  | September 30, |  |  | September 30, |
|  | 2025 |  |  | 2025 |  |  | 2024 |
Net Asset Value |  |  |  |  |  |  |  |  |
Net asset value per Share, beginning of period |  | $ | 24.81 |  |  | $ | 33.28 |  |  | $ | 35.25 |
Net realized and change in unrealized gain (loss) on investments in Ether (a) |  |  | 16.56 |  |  |  | 8.13 |  |  |  | (9.22 | )
Net investment income (loss) (b) |  |  | (0.02 | ) |  |  | (0.06 | ) |  |  | (0.01 | )
Net income (loss) |  |  | 16.54 |  |  |  | 8.07 |  |  |  | (9.23 | )
Net asset value per Share, end of period (c) |  | $ | 41.35 |  |  | $ | 41.35 |  |  | $ | 26.02 |
Market value per Share, beginning of period (d) |  | $ | 25.13 |  |  | $ | 33.39 |  |  | $ | 34.60 |
Market value per Share, end of period (d) |  | $ | 41.48 |  |  | $ | 41.48 |  |  | $ | 25.94 |
Ratio to average Net Assets (e) |  |  |  |  |  |  |  |  |
Net Investment income (loss) |  |  | (0.25 | )% |  |  | (0.25 | )% |  |  | (0.25 | )%
Expenses |  |  | 0.25 | % |  |  | 0.25 | % |  |  | 0.25 | %
Total Return, at net asset value (f)(g) |  |  | 66.67 | % |  |  | 24.25 | % |  |  | (26.18 | )%
Total Return, at market value (f)(g) |  |  | 65.06 | % |  |  | 24.23 | % |  |  | (25.03 | )%

(a)
Net realized and change in unrealized gain (loss) on investments in Ether per share may not correlate with the Trust's net realized and unrealized gain (loss) due to timing of shareholder transactions in relation to the fluctuating market values of the Trust's investments.
(b)
Based on average shares outstanding.
(c)
For financial reporting purposes, the Trust values transactions based upon the end of reporting period price in the market. Accordingly, the investment valuations in these financial statements may differ from those used in the calculation of certain of the Trust’s final creation and redemption NAVs.
(d)
The mean between the last bid and ask prices.
(e)
Annualized.
(f)
Total Return, at NAV is calculated assuming an initial investment made at the NAV at the beginning of the period, reinvestment of all dividends and distributions at NAV during the period, and redemption of Shares at NAV on the last day of the period. Total Return, at NAV includes adjustments in accordance with U.S. GAAP and as such, the NAV for financial reporting purposes and the returns based upon those NAVs may differ from the NAVs and returns for shareholder transactions. Total Return, at market value is calculated assuming an initial investment made at the market value at the beginning of the period, reinvestment of all dividends and distributions at market value during the period, and redemption of Shares at the market value on the last day of the period. Not annualized for periods less than one year, if applicable.
(g)
The net asset value total return from June 17, 2024 to September 30, 2024 was 4.08%. The market price total return from June 17, 2024 to September 30, 2024 was 3.76%.

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Note 11 - Subsequent Event

Pursuant to a prospectus amendment declared effective on September 30, 2025, the Trust may begin to allow for creation and redemption transactions to take place in exchange for ether in-kind as an alternative to cash creations and redemptions. As of November 6, 2025, the Trust has not yet begun accepting in-kind orders, but may do so at any time, in the Sponsor’s sole discretion. When purchasing Creation Baskets in-kind with ether, Authorized Participants deliver ether to the Ethereum Custodian. After confirming receipt of the ether by the Ethereum Custodian, the Transfer Agent is authorized by the Sponsor to issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order. When redeeming Creation Baskets in-kind for ether, the Transfer Agent redeems the Shares and the Ethereum Custodian distributes the resulting ether to the redeeming Authorized Participant in satisfaction of the redemption order.

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ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This information should be read in conjunction with the financial statements and notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q (the “Report”). This Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve substantial risks and uncertainties. The matters discussed throughout this Report that are not historical facts are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this Report that address activities, events or developments that will or may occur in the future, including such matters as movements in the digital asset markets, operations of Invesco Galaxy Ethereum ETF (the “Trust”), plans and references by Invesco Capital Management LLC (the “Sponsor”) to the Trust’s future success and other similar matters, are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses the Sponsor has made based on its perception of historical trends, technology developments regarding the use of ether and other digital assets, including the systems used by the Sponsor and Coinbase Custody Trust Company, LLC, the Trust’s Ethereum custodian (the “Ethereum Custodian”) in their provision of services to the Trust, current conditions and expected future developments, as well as other factors appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsor’s expectations and predictions, however, is subject to a number of risks and uncertainties, including the special considerations discussed in this Report, and the risks described in Part I, Item 1A. “Risk Factors” of the Trust’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, together with the modified risk factor included in Item 1A of this Report, and in other SEC filings by the Trust, as well as general economic, market and business conditions, changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies, and other economic and political developments. Consequently, all the forward-looking statements made in this Report are qualified by these cautionary statements, and there can be no assurance that actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, that they will result in the expected consequences to, or have the expected effects on, the Trust’s operations or the value of its Shares. None of the Trust, the Sponsor, or the Trustee or their respective affiliates is under a duty to update any of the forward-looking statements to conform such statements to actual results or to a change in the Sponsor’s expectations or predictions.

Overview/Introduction

The Invesco Galaxy Ethereum ETF (the “Trust”) is a Delaware statutory trust that was formed on September 27, 2023. The Trust continuously issues common shares representing fractional undivided beneficial interest in and ownership of the Trust (“Shares”). The Trust operates pursuant to its Second Amended and Restated Declaration of Trust and Trust Agreement, dated as of June 21, 2024 (the “Trust Agreement”). The Shares began trading on the Cboe BZX Exchange, Inc. (the “Exchange”) under the ticker symbol “QETH” on July 23, 2024. The Trust offers Shares only to certain eligible financial institutions (“Authorized Participants”) in one or more blocks of 5,000 Shares (“Creation Baskets”) based on the quantity of ether attributable to each Share of the Trust.

The following discussion and analysis was prepared to supplement information contained in the accompanying financial statements and is intended to explain certain items regarding the Trust's financial condition as of September 30, 2025, and its results of operations for the three and nine months ended September 30, 2025 and the period July 23, 2024 to September 30, 2024. It should be read in conjunction with the unaudited financial statements and related notes thereto contained in this Report.

Investment Objective

The investment objective of the Trust is for the Shares to reflect the performance of the spot price of ether as measured using the Lukka Prime Ethereum Reference Rate (the “Benchmark”) less the Trust’s expenses and other liabilities. The Shares are intended to provide institutional and retail investors with a simple, cost-effective means of gaining investment benefits similar to those of holding ether.

Determination of Net Asset Value

The Administrator calculates, and the Sponsor publishes, the Trust’s Net Asset Value (“NAV”) once each business day. To calculate the NAV, the Administrator totals the current market value of ether in the Trust and any other assets, and subtracts any liabilities including accrued but unpaid expenses. The Trust’s NAV is an amount denominated in U.S. dollars.

The Administrator also determines the NAV per Share, which equals the NAV of the Trust divided by the number of outstanding Shares. The NAV of the Trust and the NAV per Share are published by the Sponsor on each day that the Exchange is open for regular trading and are posted on the Trust’s website, www.invesco.com/QETH.

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Valuation of Ether

The Trust applies FASB ASC Topic 820, Fair Value Measurement, in the valuation of ether held by the Trust and for financial statement purposes. The fair market value price for ether reflects the price that would be received for ether in a current sale, which assumes an orderly transaction between market participants on the measurement date of ether on its “principal market,” generally, the most advantageous market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Trust determines its principal market (or in the absence of a principal market the most advantageous market) on a periodic basis to determine which market is its Principal Market for the purpose of calculating fair value for the creation of quarterly and annual financial statements. Issuer-specific events, market trends, bid/asked quotes of brokers and information providers and other data may be reviewed in the course of making a good faith determination of a security’s fair value.

Liquidity and Capital Resources

The Sponsor is not aware of any known trends, demands, commitments, events or uncertainties that will result in, or are reasonably likely to result in, material changes to the Trust’s liquidity and capital resources needs.

The Trust pays the Sponsor a unified fee of 0.25% per annum (the “Sponsor Fee”) as compensation for services performed under the Trust Agreement. The Trust’s only ordinary recurring expense is the Sponsor Fee. The Sponsor Fee is accrued daily and paid monthly in arrears in U.S. dollars, and is calculated by Bank of New York Mellon (the “Administrator”). The Administrator calculates the Sponsor Fee on a daily basis by applying the 0.25% annualized rate to the Trust’s total net assets.

Except as noted below, the Sponsor has agreed to pay all of the Trust’s ordinary expenses out of the Sponsor’s unified fee, including, but not limited to, the Trustee’s fees, the fees of The Bank of New York Mellon (for its services as the Administrator, Transfer Agent, and Cash Custodian), the fees of the Ether Custodian, the fees of the Execution Agent, Exchange listing fees, SEC registration fees, printing and mailing costs, legal costs and audit fees. The Sponsor also paid the costs of the Trust’s organization.

The Trust may incur certain extraordinary expenses that are not assumed by the Sponsor. These include, but are not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, Ethereum network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders (including, for example, in connection with any fork of the Ethereum blockchain), any indemnification of the Sponsor, Cash Custodian, Ethereum Custodian, Administrator or other agents, service providers or counterparties of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters.

To cover the Sponsor Fee, and extraordinary expenses not assumed by the Sponsor, the Sponsor or its delegate will cause the Trust (or its delegate) to instruct Galaxy Digital Funds LLC (the “Execution Agent”) to convert ether held by the Trust into U.S. dollars. The Execution Agent will seek to sell ether at approximately the price at which it is valued by the Trust and in the smallest amounts required to permit such payments as they become due, with the intention of minimizing the Trust’s holdings of assets other than ether. Accordingly, the amount of ether to be sold may vary from time to time depending on the level of the Trust’s expenses and liabilities and the market price of ether. The NAV of the Trust and the number of ether represented by a Share will decline each time the Trust accrues the Sponsor Fee or any Trust expenses not assumed by the Sponsor. The Trust is not responsible for paying any costs associated with the transfer of ether to or from the Trust in connection with paying the Sponsor Fee or in connection with creation and redemption transactions.

The Trust has not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Trust’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to Shareholders.

Cash Flows

A primary cash flow activity of the Trust is to raise capital from Authorized Participants through the issuance of Shares. This cash is used to invest in ether.

As of the date of this Report, each of ABN AMRO Clearing Chicago LLC, BNY Mellon Capital Markets, LLC, Citadel Securities LLC, Goldman Sachs & Co., Jane Street Capital LLC, Jefferies LLC, JP Morgan Securities Inc., Macquarie Capital (USA) Inc. and Virtu Americas LLC has executed a Participant Agreement and are the only Authorized Participants.

Operating Activities

Net cash flow provided by (used in) operating activities was $(7.2) million and $(23.9) million for the nine months ended September 30, 2025 and the period June 17, 2024 to September 30, 2024, respectively. During the nine months ended September 30, 2025, $33.4 million was paid to purchase ether and $26.2 million was received from sales of ether for redemptions. During the period June 17, 2024 to September 30, 2024, $23.9 million was paid to purchase ether and $0 million was received from sales of ether for redemptions.

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Financing Activities

The Trust’s net cash flow provided by (used in) financing activities was $7.2 million and $23.9 million during the nine months ended September 30, 2025 and the period June 17, 2024 to September 30, 2024, respectively. This included $33.4 million and $24.0 million from Shares purchased by Authorized Participants and $26.2 million and $0.1 million from Shares redeemed by Authorized Participants during the nine months ended September 30, 2025 and the period June 17, 2024 to September 30, 2024, respectively.

Results of Operations

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND FOR THE PERIOD JULY 23, 2024 TO SEPTEMBER 30, 2024

The following graph illustrates the percentage changes in (i) the market price of the Shares (as reflected by the line “Market”), (ii) the Trust’s NAV (as reflected by the line “NAV”), and (iii) the closing levels of the Benchmark (as reflected by the line “Lukka Prime Reference Rate (USD)”). There can be no assurance that the price of the Shares or the Trust’s NAV will exceed the Benchmark levels.

No representation is being made that the Benchmark will or is likely to achieve closing levels consistent with or similar to those set forth herein.

COMPARISON OF MARKET, NAV AND LUKKA PRIME ETHEREUM REFERENCE RATE (USD)

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND FOR THE PERIOD JULY 23, 2024 TO SEPTEMBER 30, 2024

NEITHER THE PAST PERFORMANCE OF THE TRUST NOR THE PRIOR BENCHMARK LEVELS AND CHANGES,

POSITIVE OR NEGATIVE, SHOULD BE TAKEN AS AN INDICATION OF THE TRUST’S FUTURE PERFORMANCE.

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NEITHER THE PAST PERFORMANCE OF THE TRUST NOR THE PRIOR BENCHMARK LEVELS AND CHANGES,

POSITIVE OR NEGATIVE, SHOULD BE TAKEN AS AN INDICATION OF THE TRUST’S FUTURE PERFORMANCE.

NEITHER THE PAST PERFORMANCE OF THE TRUST NOR THE PRIOR BENCHMARK LEVELS AND CHANGES,

POSITIVE OR NEGATIVE, SHOULD BE TAKEN AS AN INDICATION OF THE TRUST’S FUTURE PERFORMANCE.

Trust Share Price Performance

For the three months ended September 30, 2025, the Exchange market value of each Share increased from $25.13 per Share to $41.48 per Share. The Share price low and high for the three months ended September 30, 2025 and related change from the Share

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price on June 30, 2025 was as follows: Shares traded at a low of $23.98 per Share (-4.58%) on July 1, 2025, and a high of $48.23 per Share (+91.92%) on August 22, 2025. The total return for the Trust on a market value basis was +65.06%.

Ethereum was a standout in the third quarter of 2025, rallying by over 65%, far outpacing bitcoin’s 7% gain. Crypto broadly benefited from supportive regulatory developments, particularly the passage of the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, which solidified the regulation of stablecoins and put Ethereum at the forefront given it is the leading platform for stablecoins. Corporate launches of new layer-1 networks, President Trump's executive order permitting retirement accounts to hold digital assets, and a more positive macroeconomic backdrop leading into the September Federal Reserve (Fed) rate cut also provided optimism for digital assets. US exchange-traded product (“ETP”) inflows also continued to pick up.

For the nine months ended September 30, 2025, the Exchange market value of each Share increased from $33.39 per Share to $41.48 per Share. The Share price low and high for the nine months ended September 30, 2025 and related change from the Share price on December 31, 2024 was as follows: Shares traded at a low of $14.60 per Share (-56.27%) on April 8, 2025, and a high of $48.23 per Share (+44.44%) on August 22, 2025. The total return for the Trust on a market value basis was +24.23%.

Ethereum posted positive results of over 25% in the first three quarters of 2025. While it experienced sharp losses in the first quarter of 2025 of over 45% due to deteriorating macroeconomics and a broad selloff in digital assets, as well as the ByBit hack feeding negative sentiment on crypto, prices rebounded strongly in the second and third quarters. Growing institutional demand and ETP inflows amid improving risk appetite and the resumption of Fed easing drove positive momentum. The Pectra upgrade in the second quarter of 2025 also significantly improved investor confidence in the Ethereum network. Lastly, the US regulatory environment was a tailwind, particularly in July when the GENIUS Act was adopted, establishing a federal regulatory regime for stablecoins and Ethereum is the leading blockchain platform for stablecoins.

For the period July 23, 2024 (commencement of trading) to September 30, 2024, the Exchange market value of each Share decreased from $34.60 per Share to $25.94 per Share. The Share price low and high for the period ended September 30, 2024 and related change from the Share price on July 23, 2024 was as follows: Shares traded at a low of $22.21 per Share (-35.82%) on September 6, 2024, and a high of $34.60 per Share (+0.00%) on July 23, 2024. The total return for the Trust on a market value basis was -25.03%.

Since the Trust’s launch on July 23, 2024, Ethereum has been pressured by broader risk-off moves and generally lackluster ETP demand. The U.S. equity market sell-off to end July, reignited hard landing concerns in the U.S., the Chinese economic overhang, and rising geopolitical tensions in the Middle East all played a role, though the start of the Federal Reserve’s easing cycle in September 2024 was a positive catalyst. Another influencing factor was market expectations for a potential second term as president by former President Trump, especially prior to Vice President Harris joining the presidential race in August. In this respect, former President Trump was generally viewed as more “pro-crypto” and could potentially seek relaxed regulations and more innovation-focused projects.

Trust Share Net Asset Performance

For the three months ended September 30, 2025, the NAV of each Share increased from $25.10 per Share to $41.49 per Share. The rising price of ether during the three months ended September 30, 2025 contributed to an overall 65.39% increase in the level of the Benchmark. The total return for the Trust on a NAV basis was +65.30%.

Net income (loss) for the three months ended September 30, 2025 was $14.1 million, primarily resulting from net realized gain (loss) of $0.4 million and net change in unrealized gain (loss) of $13.7 million.

For the nine months ended September 30, 2025, the NAV of each Share increased from $33.37 per Share to $41.49 per Share. The rising price of ether during the nine months ended September 30, 2025 contributed to an overall 24.58% increase in the level of the Benchmark. The total return for the Trust on a NAV basis was +24.33%.

Net income (loss) for the nine months ended September 30, 2025 was $8.2 million, primarily resulting from net realized gain (loss) of $(0.4) million and net change in unrealized gain (loss) of $8.7 million.

For the period July 23, 2024 (Commencement of Trading) to September 30, 2024, the NAV of each Share decreased from $34.60 per Share to $25.93 per Share. Falling price for ether during the period ended September 30, 2024 contributed to an overall 25.01% decrease in the level of the Benchmark. The total return for the Trust on a NAV basis was -25.06%.

Net income (loss) for the period ended September 30, 2024 was $(3.5) million, primarily resulting from net change in unrealized gain (loss) of $(3.5) million.

On June 17, 2024, the Trust was seeded with $100,000 through the sale of 4,000 Shares (“Initial Seed Shares”) at a per-Share price of $25.00 by the Trust to Invesco Ltd. Through June 30, 2024, the Trust had no operations other than those related to its organization and registration and the sale of the Initial Seed Shares.

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Critical Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires the Sponsor to make estimates and assumptions that affect the reported amounts of the assets and liabilities and disclosures of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period covered by this report. A description of the valuation of ether, a critical accounting policy that the Trust believes is important to understanding its results of operations and financial position, is provided in the section entitled “Valuation of Ether,” above. In addition, please refer to Note 2 to the financial statements of the Trust for further discussion of the Trust’s accounting policies and Part II, Item 7 – “Management’s Discussions and Analysis of Financial Condition and Results of Operations – Critical Accounting Estimates” in the Annual Report on Form 10-K for the period ended December 31, 2024, as filed with the SEC on February 28, 2025.

There were no material estimates, which involve a significant level of estimation uncertainty and had or are reasonably likely to have had a material impact on the Trust’s financial condition, used in the preparation of these financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

None.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of the management of the Sponsor, including Brian Hartigan, its Principal Executive Officer, and Kelli Gallegos, its Principal Financial and Accounting Officer, Investment Pools, the Trust carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Quarterly Report, and, based upon that evaluation, Brian Hartigan, the Principal Executive Officer of the Sponsor, and Kelli Gallegos, the Principal Financial and Accounting Officer, Investment Pools, of the Sponsor, concluded that the Trust's disclosure controls and procedures were effective to provide reasonable assurance that information the Trust is required to disclose in the reports that it files or submits with the Securities and Exchange Commission (the “SEC”) under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms, and to provide reasonable assurance that information required to be disclosed by the Trust in the reports that it files or submits under the Exchange Act is accumulated and communicated to management of the Sponsor, including its Principal Executive Officer and Principal Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There has been no change in internal control over financial reporting (as defined in the Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during the Trust’s quarter ended September 30, 2025 that has materially affected, or is reasonably likely to materially affect, the Trust's internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

Not applicable.

Item 1A. Risk Factors.

Except for the modified risk factor set forth below, there have been no material changes from risk factors as previously disclosed in the Trust's Annual Report on Form 10-K for the period ended December 31, 2024, filed with the SEC on February 28, 2025.

The Effect of Market Disruptions and Government Interventions Are Unpredictable and May Have an Adverse Effect on an investment in the Shares.
Digital asset markets may be subject to temporary distortions due to various factors, including, among others, real or perceived adverse economic conditions, adverse investor sentiment generally, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, lack of liquidity, manipulation and disruptive conduct, excessive speculation, regional or global instability and uncertainty, changes in trade regulation or economic sanctions, government regulation and intervention, technical and operational or system failures, nuclear accidents, terrorism, riots and acts of God. In addition, economies and financial markets throughout the world have become increasingly interconnected, which increases the likelihood that events or conditions in one region or country will adversely affect markets and asset classes in other regions or

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countries.
Certain changes in the U.S. economy in particular, such as when the U.S. economy weakens or when its financial markets decline, may have a material adverse effect on global financial markets as a whole. Increasingly strained relations between the U.S. and foreign countries, including as a result of economic sanctions and tariffs, may also adversely affect digital asset markets. A decrease in U.S. imports or exports, changes in trade regulations, including the threat or actual imposition of tariffs, trade wars or other economic sanctions on traditional allies or adversaries and their responses thereto, inflation, and/or an economic recession in the U.S. may have a material adverse affect on the U.S. economy, global financial markets as a whole and the digital asset market to which the Trust has exposure. Proposed and adopted policy and legislative actions in the U.S. may impact many aspects of financial and other regulations and may have a significant effect, including potentially adversely, on U.S. markets generally. The continued maintenance of elevated debt levels by the U.S. government as projected by governmental agencies and non-governmental organizations, or the imposition of U.S. austerity measures, could potentially constrain future economic growth and the ability to effectively respond to economic downturns. If these trends were to continue, they could adversely impact the U.S. economy, global financial markets as a whole and the digital asset markets in particular.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(a) There have been no unregistered sales of Shares. No Shares are authorized for issuance by the Trust under equity compensation plans.

(b) Not applicable.

(c) Although the Trust does not redeem Shares directly from its Shareholders, the Trust, from time to time, redeems Creation Baskets from Authorized Participants. During the three months ended September 30, 2025, the Trust's redemption of Creation Baskets from Authorized Participants, if any, are provided in the table below:

Period of Redemption |  | Total Number of Shares Redeemed |  |  | Average Price Paid per Share |
July 1, 2025 to July 31, 2025 |  |  | — |  |  | $ | — |
August 1, 2025 to August 31, 2025 |  |  | 420,000 |  |  | $ | 37.75 |
September 1, 2025 to September 30, 2025 |  |  | 210,000 |  |  | $ | 42.40 |
Total |  |  | 630,000 |  |  | $ | 39.30 |

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

During the period covered by this Quarterly Report, none of the members of the Sponsor responsible for overseeing the business and operations of the Trust adopted, modified or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement.

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Item 6. Exhibits.

Exhibit No. |  | Description
3.1 |  | Declaration of Trust and Trust Agreement 1
3.2 |  | Amended and Restated Declaration of Trust and Trust Agreement 2
3.3 |  | Second Amended and Restated Declaration of Trust and Trust Agreement 3
3.4 |  | Certificate of Trust 1
31.1 |  | Certification required under Exchange Act Rules 13a-14 and 15d-14 *
31.2 |  | Certification required under Exchange Act Rules 13a-14 and 15d-14 *
32.1 |  | Certification by Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 +
32.2 |  | Certification by Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 +
101 |  | Interactive data file pursuant to Rule 405 of Regulation S-T: (i) the Statements of Financial Condition of Invesco Galaxy Ethereum ETF — September 30, 2025 and December 31, 2024 (Unaudited), (ii) the Schedule of Investments of Invesco Galaxy Ethereum ETF — September 30, 2025 (Unaudited), (iii) the Schedule of Investments of Invesco Galaxy Ethereum ETF — December 31, 2024 (Unaudited), (iv) the Statement of Income and Expenses of Invesco Galaxy Ethereum ETF — For the Three Months Ended September 30, 2025 and 2024, the Nine Months Ended September 2025 and the Period June 17, 2024 to September 30, 2024 (Unaudited), (v) the Statement of Changes in Shareholders’ Equity of Invesco Galaxy Ethereum ETF — For the Three Months Ended September 30, 2025 and 2024 (Unaudited), (vi) the Statement of Changes in Shareholders’ Equity of Invesco Galaxy Ethereum ETF — For the Nine Months Ended September 30, 2025 and the Period June 17, 2024 to September 30, 2024 (Unaudited), (vii) the Statement of Cash Flows of Invesco Galaxy Ethereum ETF — For the Nine Months Ended September 30, 2025 and the Period June 17, 2024 to September 30, 2024 (Unaudited) and (viii) Notes to Unaudited Financial Statements of Invesco Galaxy Ethereum ETF — September 30, 2025.
101.INS |  | Inline XBRL Instance Document – The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document
101.SCH |  | Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104 |  | The cover page of the Trust's Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, formatted in Inline XBRL

* |  | Filed herewith.
+ |  | Furnished herewith.
1 |  | Previously filed as an exhibit to the Registration Statement on Form S-1 filed September 29, 2023, and incorporated herein by reference.
2 |  | Previously filed as an exhibit to the Registration Statement on Form S-1 filed May 31, 2024, and incorporated herein by reference.
3 |  | Previously filed as an exhibit to the Registration Statement on Form S-1 filed June 21, 2024, and incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

| Invesco Galaxy Ethereum ETF
| By: | Invesco Capital Management LLC
|  | its Sponsor
Dated: November 6, 2025 |  | By: | /S/BRIAN HARTIGAN
|  | Name: | Brian Hartigan
|  | Title: | Principal Executive Officer
Dated: November 6, 2025 |  | By: | /S/KELLI GALLEGOS
|  | Name: | Kelli Gallegos
|  | Title: | Principal Financial and Accounting Officer, Investment Pools

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