Fidelity Includes Staking in Spot Ethereum ETF Offering | Uncle Fibonacci | Coins | March 2024

Asset manager Fidelity Investments has revised its proposal to launch an exchange-traded fund based on the spot price of Ethereum to include a staking provision.

“Pursuant to the Registration Statement, Sponsor may from time to time place a portion of the Fund’s assets through one or more trusted staking providers, which may include affiliates,” the company wrote in the amendment.

Asset locking includes receipt of “specific network rewards,” the company added. According to The Block, the total amount of assets staked on Ethereum is 31.68 million ETH ($990 million).

On the protocol side, Lido, a liquid staking platform, holds 30% of the market share. Coinbase, a centralized cryptocurrency exchange service, accounts for 14%.

According to analysts at S&P Global Ratings, it is highly unlikely that an Ethereum ETF issuer will pick up its offering on a DeFi platform. Rather, their choice will be a licensed custodian represented by Coinbase.

The largest U.S. cryptocurrency exchange serves as asset custodian for eight of the 11 U.S.-licensed spot Bitcoin ETFs. However, Fidelity uses its own subsidiaries.

At the time of this writing, the company’s publicly traded products hold 132,570 BTC worth approximately $8.9 billion.

In early March, the U.S. Securities and Exchange Commission (SEC) postponed a decision on BlackRock and Fidelity’s application for a spot Ethereum ETF.