Nasdaq-Backed BlackRock Spot Ethereum ETF Staking Proposal Acknowledged by SEC
The U.S. Securities and Exchange Commission has acknowledged Nasdaq’s proposal regarding BlackRock’s spot Ethereum exchange-traded fund (ETF), potentially paving the way for staking in the coming months.
In brief
- The SEC confirmed receipt of the proposal allowing staking for BlackRock’s ETHA ETF.
- Approval timelines remain uncertain, with the regulator previously delaying similar applications.
- Since debuting a year ago, spot Ethereum ETFs have attracted $9.4 billion in net investor funds, with BlackRock’s ETHA leading inflows.
In a significant development for the cryptocurrency market, the SEC on Tuesday acknowledged Nasdaq’s proposal to allow staking for BlackRock’s spot Ethereum ETF, ETHA. If approved, the filing states the SEC will permit the world’s largest asset manager to utilize the trust’s assets for staking services within the proof-of-stake (PoS) consensus mechanism.
Under the proposal, ETHA’s staking rewards would be treated as income distributed to shareholders, with the trust’s assets kept separate from those of other entities. SEC Chair Gary Genshaft noted a decision could take up to 45 days, a timeframe the regulator might extend.
This latest development follows a series of regulatory actions by the SEC concerning staking for Ethereum ETFs:
- June 18: NYSE Arca’s rule change enabling staking for Bitwise’s Ethereum fund was initially delayed.
- June 1: SEC acknowledged Grayscale’s staking proposal for ETHE, which has previously generated negative net inflows compared to peer products.
- April: ECN filings for Nasdaq and NYSE Arca submitted or approved, marking a shift in the agency’s apparent stance on staking.
Despite these regulatory acknowledgments, a substantive approval for staking via traditional stock exchanges remains pending. While the SEC previously suggested clarity on staking’s legality, the final decisions rest with the agency.
Meanwhile, spot Ethereum ETFs have continued to see record inflows since their debut. According to CoinGlass data, these ETFs have gained $9.4 billion since inception, largely driven by BlackRock’s ETHA ETF’s approximately $9.5 billion in net inflows. Grayscale’s ETHE, despite its high expense ratio, saw net outflows of $4.3 billion across seven other products.
Ethereum appears to be riding a broader market recovery trend. CoinGecko data shows ETH trading around $3,800 on Tuesday, a marginal decrease but a significant climb over the past month of 54%. The world’s second-largest cryptocurrency has performed well alongside other altcoins like Ripple (XRP) and Solana.
