Grayscale has introduced staking functionality to its spot Ethereum exchange-traded funds, marking the first time U.S. investors can earn staking rewards through traditional ETF products. The asset manager activated the feature for both its Ethereum Trust ETF and Ethereum Mini Trust ETF on Monday.
The firm filed its staking addendum with the Securities and Exchange Commission on Monday, enabling institutional investors to capture additional yields beyond price appreciation. Grayscale will utilize institutional custodians including Coinbase and a diversified network of validator providers to stake its Ethereum holdings.
Grayscale CEO Peter Mintzberg described staking as the type of first‑mover innovation the company was built to deliver. He emphasized that the firm's position as the largest digital asset–focused ETF issuer by assets under management uniquely positions it to convert new opportunities into tangible value for investors.
The Ethereum Trust ETF holds $4.82 billion in assets, making it the second‑largest Ethereum fund on Wall Street. Both products will now allow investors to participate in Ethereum's proof‑of‑stake consensus mechanism, which the network adopted in 2022 to reduce energy consumption.
Grayscale also activated staking for its Solana Trust, though this product remains pending regulatory approval for ETF conversion. Upon approval, it could become one of the first spot Solana ETFs offering staking rewards to traditional investors.
The absence of staking rewards has been cited as a key factor in slower adoption of Ethereum ETFs since their July 2024 launch. Data from SoSoValue shows that total net assets in Ethereum ETFs currently stand at $30.5 billion, representing 5.6 % of Ethereum's market capitalization.
Bitcoin ETFs hold $164.5 billion in net assets, equivalent to 6.7 % of the Bitcoin market cap. However, Ethereum has outperformed Bitcoin with 156 % gains over six months compared to Bitcoin's 50 % appreciation during the same period.
Ethereum funds attracted $1.48 billion in inflows last week as part of the record $5.95 billion flowing into crypto investment products globally. The asset has set a new all‑time high approaching $5,000 in September, driving increased institutional demand.
Grayscale plans to extend staking capabilities to additional products as the digital asset ecosystem evolves. This competitive advantage could help the firm close the gap with BlackRock, whose Bitcoin and Ethereum ETFs currently dominate market share in the crypto ETF sector.