Grayscale, the crypto asset manager, has launched staking for its exchange-traded products (ETPs), becoming the first US-based crypto fund provider to offer passive income opportunities through staking.
On Monday, Grayscale announced that its Ether (ETH) ETFs — the Grayscale Ethereum Mini Trust ETF (ETH) and Grayscale Ethereum Trust ETF (ETHE) — are the first US-listed spot crypto funds to provide staking opportunities, which Grayscale describes as “another first-mover milestone.”
Grayscale’s Solana (SOL) fund, the Grayscale Solana Trust (GSOL), has also implemented staking and is seeking regulatory approval to uplist as an ETP, potentially becoming one of the pioneering spot Solana ETPs to offer staking, according to the company’s announcement on X.
By enabling staking in both its Ethereum and Solana products, Grayscale seeks to provide investors with exposure to the “long-term value growth of these networks while upholding the funds’ primary objectives.”
“Staking in our spot Ethereum and Solana funds exemplifies the type of first-mover innovation that Grayscale aims to deliver,” stated Grayscale CEO Peter Mintzberg. “As the leading digital asset-focused ETF issuer globally by AUM, we believe our dependable and extensive platform positions us uniquely to transform new opportunities, like staking, into real value for investors.”
ETHE and ETH are exchange-traded products registered under the Securities Act of 1933, as opposed to the Investment Company Act of 1940, which governs traditional mutual funds.
This structural distinction sets them apart from ETFs regulated by the 1940 Act, although they operate under the same legal framework applied to spot Bitcoin (BTC) and Ether ETFs.
“ETHE and ETH hold digital assets; however, investing in ETHE and ETH does not equate to a direct investment in digital assets,” clarified Grayscale.
Grayscale plans to manage staking through institutional custodians and a diverse network of validators, allowing investors to access the products via standard brokerage accounts.
As of September 30, Grayscale reported approximately $35 billion in assets under management.
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Crypto industry awaits SEC approval of staking ETFs
This announcement comes as the industry anticipates the US Securities and Exchange Commission (SEC) regulatory approval for the first US-listed Ether staking ETFs.
Approval of the inaugural Ether staking ETF could infuse significant new institutional capital into the crypto sector, according to 10x Research’s head of research, Markus Thielen.
“This would signify a momentous structural change in how institutional capital enters Ethereum, ushering in a new phase of yield-driven investment,” Thielen told Cointelegraph.
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This development follows the launch of the REX-Osprey Solana Staking ETF on the Cboe BZX Exchange three months ago, which achieved $33 million in trading volume and $12 million in inflows on its first day, as reported by Cointelegraph on July 3.
Rex-Osprey’s fund was the first to initiate a Solana staking ETF under the Investment Company Act of 1940, enabling crypto ETFs to directly hold the majority of their spot assets and distribute staking rewards where applicable.
In general, spot Bitcoin and Ether ETPs in the US have been approved through exchange rule filings (Rule 19b-4) and Securities Act registrations, rather than under the 1940 Act. The SEC has also recently authorized in-kind creations and redemptions for some crypto ETPs.
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