Cboe BZX Exchange files to add staking to Fidelity's Ethereum ETF as fund loses value amid crypto market decline
Quick Take
- Cboe BZX Exchange filed a proposed rule change which would pave the way for adding staking to Fidelity’s ether ETF.
- Fidelity’s Ethereum ETF, ticker symbol FETH, has been shrinking in terms of assets under management as the price of ether declines, mirroring the broader crypto market.
Cboe BZX Exchange filed a proposed rule change on Tuesday that would allow Fidelity Investments' spot Ethereum exchange-traded fund to have staking.
In the 19b-4 form, filed with the U.S. Securities and Exchange Commission, Cboe BZX Exchange proposes to "amend the Fidelity Ethereum Fund ... to permit staking of ether held by the Trust."
Meanwhile, Fidelity's Ethereum ETF, ticker symbol FETH, has been shrinking in terms of assets under management as the price of ether declines, mirroring the broader crypto market. FETH is the third largest ether ETF on the market, according to The Block Data Dashboard.
If approved, the proposed rule change would allow Fidelity's FETH fund to stake "all or a portion of the Trust’s ether through one or more trusted staking providers." Any rewards generated by staking would be "treated as income," the filing also said.
When spot Ethereum exchange-traded funds were approved last July by the SEC, allowing for firms like BlackRock and Grayscale to offer shares in the exchange-traded funds which track the price of ETH, staking was left out of the proposals, which appeared to help them gain approval. The Ethereum ETFs followed the successful launch of spot Bitcoin ETFs in January.
Grayscale and 21Shares are also seeking to add staking to their Ethereum ETFs.
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