Ethereum News Today: SEC Prioritizes Staking in Ethereum ETFs Before XRP Approvals

The U.S. Securities and Exchange Commission (SEC) is poised to prioritize the integration of staking services in spot Ethereum exchange-traded funds (ETFs) ahead of approving XRP-related crypto funds, signaling a strategic shift in regulatory focus toward yield enhancement and operational efficiency in the crypto market [1]. The agency recently acknowledged a 19b-4 filing from Nasdaq, enabling BlackRock’s iShares Ethereum Trust to offer staking services, a critical step in aligning these ETFs with Ethereum’s proof-of-stake (PoS) consensus model [1]. This move allows investors to earn passive rewards on their Ethereum holdings, supplementing traditional price appreciation and reducing reliance on cash settlements. Analysts note that staking in ETFs could improve tax efficiency and lower trading costs, making these products more competitive [1].

The regulatory focus on staking reflects a broader effort to refine existing ETF structures rather than expand the product lineup. ETF expert Nate Geraci predicts that staking approval for Ethereum ETFs may precede any new spot crypto ETFs, including XRP, creating a regulatory hurdle that could delay XRP fund approvals [1]. By prioritizing yield generation and structural improvements, the SEC aims to address institutional adoption challenges and enhance market efficiency. This approach aligns with recent changes allowing in-kind creation and redemption for Bitcoin and Ethereum ETFs, which reduce transaction costs and improve tax efficiency [1].

Ethereum staking in ETFs introduces a new dimension to investment returns. By locking ETH tokens within the PoS network, funds can generate additional yields, which are then distributed to investors. This innovation not only mirrors Ethereum’s real-world utility but also reduces operational friction for both institutional and retail participants [1]. The integration of staking services is expected to make Ethereum ETFs more attractive, particularly as they offer a dual benefit of price exposure and passive income.

The delay in XRP ETF approvals underscores the SEC’s current priorities. While XRP remains a significant asset in the crypto market, the regulatory landscape appears to favor incremental improvements to existing products. Geraci argues that staking represents a more immediate and impactful upgrade to crypto ETFs than introducing new assets [1]. This strategy may also reflect broader uncertainties surrounding XRP’s legal status, which could require additional scrutiny before approval.

Investors are advised to monitor regulatory developments closely, as the approval of Ethereum staking services could reshape the crypto ETF landscape. Choosing ETFs with staking capabilities allows investors to capitalize on enhanced yield opportunities, provided they understand the mechanics of staking rewards and their implications for portfolio management [1]. The SEC’s evolving stance highlights the dynamic nature of crypto regulation, where structural innovations often take precedence over product diversification.

The integration of staking in Ethereum ETFs marks a pivotal phase in the maturation of crypto investment vehicles. By prioritizing yield generation and efficiency, the SEC is aligning these products with traditional financial instruments, fostering greater institutional participation. However, the delay in XRP-related approvals underscores the need for continued regulatory clarity in the sector. As the market adapts to these changes, investors must remain informed about how structural innovations like staking and in-kind settlements impact their investment strategies [1].

Source: [1] SEC May Prioritize Staking in Spot Ethereum ETFs Before Approving XRP Funds July 30, 2025 (https://en.coinotag.com/sec-may-prioritize-staking-in-spot-ethereum-etfs-before-approving-xrp-funds/)