NEOS Files “High Income” Ethereum ETF Using Options Strategy

NEOS files for Ethereum ETF using options strategy, aiming for higher income amid rising ETH interest and pending SEC approval.

NEOS Investment Management has taken a bold step in the crypto world. The firm has filed with the U.S. Securities and Exchange Commission (SEC) to launch a new Ethereum exchange-traded fund (ETF). This ETF is referred to as the High Income Ethereum ETF. It is devised to provide investors with greater returns. It has more risk, though.

NEOS Plans Income-Focused Ethereum ETF Amid Market Surge

This ETF will not use the direct approach when tracking the price of Ethereum. It will, first, invest in the already existing spot Ethereum ETFs. Thereafter, NEOS managers will sell put and call options on those ETFs. This is called a synthetic covered call strategy. To put it in simple words, it implies that the ETF will attempt to generate additional income through options trading. Due to this, the fund offers direct exposure to Ethereum and an opportunity to increase earnings.

This is not the first time NEOS has done this. As a matter of fact, the firm already has a similar ETF on Bitcoin. That fund is named the Bitcoin High Income ETF (BTCI) and has produced good results. The distribution rate of BTCI as of August 1, 2025, is 27.92 percent. The success probably allowed NEOS to attempt the same with Ethereum.

Currently, Ethereum has been doing extremely well. Only two weeks ago, Ethereum ETFs had performed better than the Bitcoin ETFs. This shocked most players in the market. Consequently, Ethereum is igniting the interest of more investors. Bloomberg analyst Eric Balchunas reported that Ethereum has been doing very well, and that is the primary cause of the new filing of NEOS.

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Besides, the ETF crypto market is evolving. Previously, the majority of the crypto ETFs merely tracked the digital asset price. Today, more sophisticated products are being produced by companies such as NEOS. These new ETFs are aimed at addressing a variety of investor objectives. As an example, some investors are ready to accept a greater risk in order to gain more income. The new ETF is targeted at such investors by NEOS.

SEC Yet to Approve NEOS Ethereum ETF Using Options Strategy

However, there are still challenges ahead. The fund will be more volatile through the options strategy. This implies that there are chances that it can fluctuate more than usual in a regular ETF. In addition, this filing is yet to be accepted by the SEC. The agency can afford some time in the review of the risks involved. However, the decision indicates a venturing belief that firms have in Ethereum.

With high interest rates on the horizon, many investors are looking forward to making more money out of their investments. Meanwhile, they are aware of the risks involved. The ETF can be most ideal for seekers who have experience in the use of options. The fund could be too complicated to a newcomer.

However, this is a good indication for the crypto market. It demonstrates that Ethereum is becoming increasingly trusted and discussed by large financial entities. An authorization by the SEC of the ETF may lead to increased institutional investment. That would be a great leap in Ethereum and crypto in general.

To sum up, the filing by NEOS indicates a rising belief in Ethereum. It also reflects the role of innovation on the future of crypto investments. The crypto world remains in suspense, awaiting the move of the SEC.