Ethereum ETF Staking Back on the Table as SEC Reviews Cboe’s Proposal

• U.S. spot Ethereum ETFs currently hold $112.59 billion in net assets.
• NYSE and Cboe have filed to enable staking on Grayscale and 21Shares ETH ETFs, respectively.
• The 21Shares Core Ethereum ETF is the smallest fund by cumulative net inflows and net assets among competitors.

U.S. spot Ethereum (ETH) exchange-traded funds (ETFs) may soon have staking enabled as the Securities and Exchange Commission (SEC) formally acknowledges a proposal from the Cboe Global Markets exchange.

With staking now back on the table with a pro-crypto SEC, Ethereum’s long year of underperformance could soon be over.

ETH ETF Staking

Just a week after Cboe sought approval for staking in the 21Shares Core Ethereum ETF (CETH), the SEC formally acknowledged the application.

Though it’s not exactly concrete proof that staking will come to ETH ETFs, it’s a remarkably positive step forward given that removing staking rewards was a key condition that got applications over the line with the SEC.

SEC Commissioner Hester Peirce, colloquially referred to as Crypto Mom, has long sought to establish clear rules and legislation on crypto staking. Notably, she had previously expressed an openness toward ETH staking in the future.

Spot Ethereum funds got off to a very slow start compared to their Bitcoin counterparts. Over time, however, they’ve gained a great deal of momentum.

Though their trading volumes or inflow/outflow rates are comparable to BTC funds, funds are becoming more consistent in their inflows. This recently pushed ETH funds to outpace BTC for four days straight.

The Missing Piece

Unlike Bitcoin, Ethereum is not a finite token. Therefore, staking is arguably the biggest value proposition of ETH to major investors.

Moreover, without staking, these ETH tokens are being stored away in a more centralized manner, and not used to secure and further decentralize the network through new nodes and staking.

Presumably, ETH nodes operated by institutions as large as 21Shares, or BlackRock, could offer major benefits to the network.

In the eyes of many experts and analysts, ETH seriously underperformed in 2024, and barely managed to capitalize on any major development that would typically boost another token.

Ethereum ETFs launching in both the U.S. and Hong Kong, the all-important Dencun upgrade, and the bullish tides brought on by the so-called Trump Trade have failed to pump the token in line with the rest of the market.

In fact, ETH is currently trading down 6.9% at $2,743 in the past 365 days. It peaked at $4,066 in March 2024, and briefly surpassed $4,006 upon Donald Trump’s election victory.

Should staking rewards finally become enabled on ETH ETF markets, a steady flow of inflow optimism could soon snowball into a long-awaited bull run on ETH.