SEC Nods to Ethereum ETF Staking, Boosting Institutional Interest

The U.S. Securities and Exchange Commission (SEC) has taken a significant step towards the approval of Ethereum ETF staking, signaling a potential shift in the cryptocurrency landscape. The SEC recently acknowledged a request submitted by 21Shares through the Cboe BZX Exchange, which would allow staking in its Ethereum ETF. This move has renewed confidence among institutional investors, leading to increased interest in Ethereum.

If the request is granted, this would be the first ETF in the U.S. to provide staking, giving investors the opportunity to earn rewards on their holdings. The proposal disclosed different staking models, including staking-as-a-service and delegated staking, which allow investors to stake ETH through the fund without managing the process. The current administration's pro-crypto stance could help push the approval forward.

Major institutional investors have shown confidence in Ethereum following these announcements. Fidelity recently purchased $24.47 million worth of ETH, bringing its total net inflow to $1.54 billion and increasing its Ethereum assets to $1.27 billion. Meanwhile, Grayscale has been selling off its Ethereum holdings, with $5.45 million sold recently, but still holds $3.54 billion, making it the second-largest holder.

Ethereum's price has been slowly recovering, bouncing from a key support level at $2,644 and now trading at around $2,736. To maintain its upward trend, ETH must break above the 20-day EMA at $2,784. If this happens, it could climb to $3,114 and potentially reach $4,000. ETH's support levels currently stand at $2,600 and $2,224. The market is closely watching the reaction to the ETF staking news, as approval could fuel a bigger rally. However, price movements will depend on broader market trends and regulatory decisions in the coming weeks.