BlackRock, the world’s largest asset manager, has asked U.S. regulators to authorize a fund called ETHB, a product meant to behave like an Ethereum tracker while quietly earning rewards in the background.
Instead of buying ETH and leaving it idle, the trust intends to commit most of its holdings — potentially up to 90% — to Ethereum’s proof-of-stake system. That means ETH inside the ETF could be locked to help secure the network and in return generate payouts, similar to a dividend.
BlackRock won’t operate validators itself. The role falls to regulated third parties, with Coinbase Custody selected to safeguard assets and Anchorage Digital positioned as a backup. This keeps the firm one step removed from technical risk while still capturing network rewards.
Why the Product Exists Now
Ethereum has increasingly been treated as an income-bearing asset by institutions. Firms such as Bitmine continued adding ETH even during downturns, betting on staking rewards rather than short-term sentiment. BlackRock appears to be designing a vehicle for investors who want that yield logic without touching crypto wallets, slashing penalties or validator queues.
After reviewing the filing, Bloomberg analyst Eric Balchunas suggested the fund is another piece of a broader crypto toolkit — pairing Bitcoin exposure with Ethereum yield under one financial umbrella.
ETF Mechanics in Plain Language
ETHB would behave more like a trust than a trading account. Shares represent fractions of the underlying ETH pool, and only authorized market participants can create or redeem them in bulk. Everyone else buys and sells shares on Nasdaq like any other ETF, without ever seeing the underlying tokens.
The filing makes clear that staking rewards are not guaranteed — delays, validator issues, or withdrawal bottlenecks could affect returns. BlackRock also notes it can reduce its staked portion during periods of network stress to safeguard liquidity.
Bigger Picture: A Milestone for Ethereum Legitimacy
To supporters, the proposal signals that Ethereum has crossed another psychological threshold: it is no longer simply viewed as a speculative commodity but as a financial instrument capable of producing yield inside traditional markets.
If the SEC signs off, ETHB could give pensions, banks and asset managers an on-ramp into staking rewards without crypto infrastructure — potentially expanding Ethereum’s role in institutional portfolios.