On Valentine’s Day 2025, the New York Stock Exchange (NYSE) Arca submitted a proposal to the SEC for allowing staking associated with Grayscale’s spot Ethereum ETFs. This follows several Grayscale filings related to Bitcoin ETFs amid a rising market trend.
Just recently, 21Shares became the first asset manager to seek staking for its spot Ether ETF, backed by the CBOE BZX Exchange’s filing to the SEC.
Breaking News: The New York Stock Exchange has put forth a proposal to permit staking for Grayscale’s Ethereum ETF. — Watcher.Guru (@WatcherGuru) February 14, 2025
Staking for Ethereum ETFs and Its Impact on the Market
The NYSE’s latest filing aims to allow Grayscale to stake Ethereum (ETH) within its ETFs. Staking essentially involves locking ETH to validate transactions and earn rewards for such services.
If approved, these ETFs could yield extra returns from staking, subsequently benefiting investors. Presently, Grayscale’s Ethereum Mini Trust ETF has approximately $1.3 billion in assets, with Coinbase safeguarding 477,428 ETH.
The proposal emphasizes strong security controls to prevent the mishaps that might arise from validator misconduct. Notably, the Ethereum held in trust would stay with the custodian to prevent any assets from leaving during staking.
The NYSE claims their proposed staking methods are distinct from “delegated staking,” an area where the SEC has raised concerns regarding the potential qualification as securities offerings. This initiative aligns with the larger aim to enhance investor returns and adhere to regulatory frameworks.
Previously, the SEC’s conditions prior to approving spot Ether ETFs eliminated staking features due to fears of non-compliance with federal securities laws. However, forthcoming changes in regulatory perspectives, especially under the Trump administration, may lead to a revisitation of these restrictions.
Ethereum Market Sentiment in Contrast to Bitcoin
Although the launch of Ethereum ETFs in July 2024 did not significantly elevate ETH’s price, the staking proposal has changed market sentiments. Experts suggest that staking could bolster Ethereum’s long-term outlook.
Furthermore, models predict a potential Ethereum rally towards $10,000 fueled by the anticipated Pectra upgrade, which is expected to reduce Ethereum gas fees and increase adoption rates.
As trends shift, a favorable ETH/BTC ratio might signal renewed momentum for Ethereum. Staking rewards projected by Coinbase at around 2.06% could enhance the attractiveness of Ethereum ETFs beyond merely holding the asset itself.
With the Pectra upgrade and ETF staking, the community looks to influential figures like Vitalik to inspire another bull run.
If ETH can surpass its resistance of $4,000, a broader bullish trend may not be far away.
