SEC Approval Sought for Staking in 21Shares Core Ethereum ETF

The Cboe BZX Exchange has submitted a request to the Securities and Exchange Commission (SEC) to allow staking for the 21Shares Core Ethereum exchange-traded fund (ETF). This move marks the first time an ETF in the United States has proposed staking, which could potentially open up new opportunities for investors to earn extra returns.

What is Staking?

Staking involves locking up Ethereum (ETH) to help secure the Ethereum network while earning passive income in the process. If approved, this would allow investors to earn rewards by staking their ether, which is currently not possible in Ethereum ETFs.

Cboe BZX plans to use a “point-and-click” method for staking, meaning the ETH won’t be moved, lowering the risk of theft during the staking process. This approach could alleviate some of the concerns surrounding staking in ETFs.

Regulatory Hurdles

The SEC has been hesitant to allow staking in ETFs due to worries that it would violate securities laws. However, recent leadership changes within the SEC have renewed investors’ confidence that the regulator might finally consider staking in ETF products.

SEC Commissioner Hester Peirce has been advocating for regulatory changes that would allow Ethereum ETFs to include staking.

Market Impact

This news caused Ethereum’s price to rise by nearly 6% shortly after the announcement. The SEC now has 240 days to decide on the request. If approved, the change could encourage more investment in Ethereum ETFs and help strengthen the case for Ethereum as a long-term investment.

Tips for investors considering Ethereum ETFs:

• Keep an eye on regulatory developments and announcements from the SEC.
• Understand the staking process and its potential benefits and risks.
• Consider the potential impact of staking on the Ethereum network and market prices.

Stay up-to-date with the latest news and developments in the world of cryptocurrencies and finance on Global Crypto News.

Post Views: 0