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SEC Acknowledges 21Shares’ Ethereum ETF Staking Proposal
The U.S. Securities and Exchange Commission (SEC) has acknowledged a 19b-4 filing from Cboe BZX Exchange, submitted on behalf of 21Shares, seeking approval to stake Ethereum held within the 21Shares Core Ethereum ETF.
Proposal Details
The proposal, published on February 20, outlines a plan to enable the ETF to produce extra profits by staking ETH, which would be distributed to investors. According to the document, all staked ether will be owned by the trust, setting it apart from models such as staking-as-a-service or delegated staking.
SEC’s Stance on Staking
The SEC has historically had a stringent policy regarding proof-of-stake assets, categorizing staking-related activities as securities. However, under the current administration, the SEC has adopted a more pro-crypto stance, creating a dedicated crypto task force and reconsidering the classification of some tokens as securities.
This shift in regulatory stance may encourage wider adoption of staking, especially among institutions looking for more yield options in the digital asset market. Analysts believe a more transparent legal framework for staking could be a major catalyst for the growth of Ethereum and other digital assets.
Institutional Demand for Ethereum ETFs
The proposal coincides with an increase in institutional demand for Ethereum exchange-traded funds. Recent 13F filings show ownership in ETH ETFs increased from 4.8% to 14.5% in Q4 2024, while ownership of Bitcoin ETFs decreased marginally from 22.3% to 21.5%.
Implications for Ethereum and Other Digital Assets
The SEC’s acknowledgment of the proposal has sparked speculation about a broader adoption of crypto-based ETFs. Given the growing regulatory shifts, the next few months could be critical for Ethereum, XRP, and other digital assets seeking institutional adoption.
“A more transparent legal framework for staking may encourage wider adoption, especially among institutions looking for more yield options in the digital asset market.”
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