Ethereum News Today: Grayscale's Staking ETFs Challenge Bitcoin's ETF Dominance

Grayscale Investments has introduced staking functionality to its Ethereum-based exchange-traded funds (ETFs), marking a first in the U.S. market for crypto products that generate passive incomeGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. The firm's Ethereum Trust ETF (ETHE) and Ethereum Mini Trust ETF (ETH) now allow investors to earn staking rewards on their holdings. This enhancement, filed with the U.S. Securities and Exchange Commission (SEC) on Monday, leverages institutional custodians like Coinbase and a network of validator providers to stake Ethereum (ETH) on behalf of investorsGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. Grayscale also activated staking for its Solana Trust, which awaits regulatory approval to convert into an ETF, further expanding its staking capabilitiesGrayscale Ethereum ETFs Are First in US to Add Staking^[1].

The move addresses a key limitation of existing crypto ETFs, which had previously offered only price exposure without yield generation. Grayscale's Ethereum ETFs, which converted to spot-based products in July 2024 after SEC approval, now provide investors with dual benefits of price appreciation and staking rewardsGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. This innovation comes as Ethereum ETFs trail Bitcoin ETFs in adoption. While Bitcoin ETFs hold $164.5 billion in assets (6.7% of BTC's market cap), Ethereum ETFs manage $30.5 billion (5.6% of ETH's valuation), despite ETH's 156% surge over the past six monthsGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. Grayscale's CEO, Peter Mintzberg, emphasized that staking represents "first-mover innovation" and aims to close the gap with competitors like BlackRockGrayscale Ethereum ETFs Are First in US to Add Staking^[1].

The staking mechanism operates through Ethereum's proof-of-stake consensus model, where validators lock ETH to secure the network and earn rewards. Grayscale's approach diversifies validator providers to mitigate risk, ensuring alignment with institutional-grade security standardsGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. For investors, this means exposure to Ethereum's price movements while generating yield without direct token management. The firm plans to expand staking to additional products as the digital asset ecosystem evolvesGrayscale Ethereum ETFs Are First in US to Add Staking^[1].

Market dynamics highlight the strategic timing of this launch. Ethereum's price hit a record near $5,000 in September 2025, driven by macroeconomic factors and growing institutional adoptionGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. Meanwhile, crypto ETF inflows reached $5.95 billion in the week ending September 27, 2025, with Ethereum funds capturing $1.48 billion of that totalGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. Grayscale's staking feature could further attract capital to Ethereum ETFs, particularly as competitors like BlackRock dominate the ETF landscape with Bitcoin-focused productsGrayscale Ethereum ETFs Are First in US to Add Staking^[1].

The initiative reflects broader industry trends toward integrating crypto into traditional finance. Institutional investors, previously hesitant to stake due to operational complexities, now have a streamlined option through regulated ETFsGrayscale Ethereum ETFs Are First in US to Add Staking^[1]. By combining yield generation with familiar investment vehicles, Grayscale aims to appeal to both retail and institutional investors seeking diversified exposure to digital assetsGrayscale Ethereum ETFs Are First in US to Add Staking^[1].