Ethereum News Today: Nasdaq BlackRock Seek SEC Approval for Staking in Ethereum ETF

Nasdaq has submitted an amended 19b-4 filing to the Securities and Exchange Commission (SEC) to enable staking for the iShares Ethereum Trust ETF (ETHA), issued by BlackRock. This move allows the ETF's ether holdings to be used in the Ethereum network's proof-of-stake (PoS) mechanism, enabling investors to earn staking rewards. The filing reflects a broader shift in the investment landscape, as more asset management companies explore ways to integrate cryptocurrency staking into their offerings.

The iShares Ethereum Trust, operated by BlackRock subsidiary iShares Delaware Trust Sponsor LLC, currently holds ETH in custody with Coinbase Custody Trust, while BNY manages its cash assets. Coinbase also serves as the ETF’s primary broker. The fund, which debuted on Nasdaq in May 2024, could become the first spot ETH ETF to offer yield through staking—pending regulatory approval.

The proposed rule change by Nasdaq aims to provide investors with an additional avenue for generating returns beyond the traditional buy-and-hold strategy. By enabling staking, the iShares Ethereum Trust seeks to offer investors the opportunity to earn passive income through staking rewards. This move is part of a broader trend in the cryptocurrency market, where staking has become an increasingly popular way for investors to generate yields on their holdings.

This filing by Nasdaq and BlackRock is not the first of its kind. Earlier this year, other ETF issuers, including the Chicago Board Options Exchange Group and the New York Stock Exchange, proposed adding ETH staking to ETFs issued by Fidelity, Franklin, and Bitwise. Grayscale also followed up with its own proposal at the end of April. These filings indicate a growing interest in integrating staking capabilities into ETFs, as asset management companies seek to provide investors with more diverse and lucrative investment options.

The move by BlackRock and Nasdaq to enable staking for the iShares Ethereum Trust ETF is significant for several reasons. Firstly, it reflects the growing acceptance of cryptocurrencies as a legitimate asset class by traditional financial institutions. Secondly, it provides investors with a new way to generate returns on their ETH holdings, potentially making the ETF more attractive to a wider range of investors. Finally, it demonstrates the potential for innovation in the ETF market, as asset management companies continue to explore new ways to integrate cryptocurrencies into their offerings.

The proposed rule change by Nasdaq and BlackRock is subject to approval by the SEC. If approved, it could pave the way for other ETF issuers to follow suit, potentially leading to a wave of new staking-enabled ETFs in the market. This would provide investors with more options for generating passive income through staking, while also driving further adoption of cryptocurrencies as an asset class.