2025-02-20
The U.S. Securities and Exchange
Commission (SEC) has acknowledged a proposal from 21Shares, submitted through
Cboe BZX Exchange on Feb 19, 2025, to allow staking of ether (ETH) within the 21Shares Core
Ethereum ETF.
If approved, this would allow the ETF
to generate additional returns from its ETH holdings, which could then be
passed on to investors.
The SEC is asking for public comments
on this proposal. They haven’t approved it yet but are reviewing it.
Staking is a process where people lock
up their cryptocurrency to help keep the network running securely. In return,
they earn rewards in ETH.
Grayscale, another big investment firm,
also applied for staking approval for its Ethereum ETFs.
In the past, the SEC treated
proof-of-stake cryptocurrencies as securities. This made things complicated for
companies wanting to offer staking.
Now, the SEC is becoming more open to
crypto under the Trump administration.
They even formed a crypto task force to
decide which tokens should be considered “non-securities” (making regulations
easier for them).
More institutional investors are buying
Ethereum ETFs. In late 2024, ownership of ETH ETFs jumped from 4.8% to 14.5%,
while Bitcoin ETF ownership dropped slightly.
If staking is allowed in Ethereum ETFs,
it could attract more institutional investors, increase the demand for ETH, and
make crypto investing more profitable.
