The Cboe BZX Exchange has filed a request with the U.S. Securities and Exchange Commission (SEC) to allow staking for the 21Shares Core Ethereum ETF. This move could mark a historic shift in the U.S. market by transforming ETFs into tools that offer staking rewards for Ethereum.
Rule Change Request
Previous Ethereum ETF approvals in the U.S. excluded staking due to SEC concerns over whether staking activities could classify as securities. The recent 19b-4 filing by Cboe BZX Exchange aims to change that. If approved, this filing could pave the way for integrating staking into more crypto ETFs, offering higher yields for investors.
Regulatory Shift Underway
The SEC has historically taken a strict stance on staking, with former Chairman Gary Gensler suggesting that proof-of-stake tokens resemble securities. However, with a new administration and evolving regulatory perspectives, many experts believe staking approvals could become a reality by 2025. SEC Commissioner Hester Peirce recently expressed optimism about upcoming regulatory shifts and advocates for revisiting past SEC decisions on crypto ETFs.
Implications for the Market
ETF-based staking could lead to increased demand for Ethereum as institutions seek yield-generating assets. Reduced selling pressure could result from staked ETH being locked for security purposes. The introduction of regulated staking products to the market may facilitate broader adoption among institutional investors.
The SEC will review the rule change request before making a decision. If approved, this could trigger a wave of similar filings from other ETF providers like BlackRock and Fidelity, strengthening Ethereum's position in traditional finance and making it more attractive to institutional investors.
