NYSE Proposes Staking for Bitwise Ethereum ETF: A Game Changer for Crypto Investments?

On March 20, 2025, the New York Stock Exchange (NYSE) submitted a proposal to the U.S. Securities and Exchange Commission (SEC) to allow the Bitwise Ethereum exchange-traded fund (ETF) to stake its Ethereum (ETH) holdings. If approved, this move could significantly enhance the attractiveness of Ethereum ETFs by enabling staking rewards for investors.

Key Takeaways

• NYSE proposes staking for Bitwise Ethereum ETF to SEC.

• Staking could provide additional rewards for ETF investors.

• The proposal follows a similar request from Cboe BZX Exchange for Fidelity's ETF.

• Staking involves locking up ETH to support the Ethereum network.

• BlackRock's head of digital assets highlights the potential impact of staking on ETF success.

Understanding Staking in Ethereum

Staking is a process unique to proof-of-stake (PoS) blockchains like Ethereum, where users lock up a minimum of 32 ETH to help secure the network. In return, they earn staking rewards, which can be an attractive incentive for investors. The NYSE's proposal emphasizes a user-friendly method known as point-and-click staking, which allows the fund to stake ETH without transferring it out of its wallet, thereby minimizing the risk of theft.

The Current Landscape of Ethereum ETFs

Despite the growing interest in cryptocurrency investments, Ethereum ETFs have not achieved the same level of success as their Bitcoin counterparts. The launch of several spot Bitcoin ETFs in January 2024 and Ethereum ETFs in July 2024 saw major financial institutions like BlackRock and Fidelity entering the market. However, the lack of staking rewards has been cited as a significant barrier to the popularity of Ethereum ETFs.

Industry Reactions

At the recent Digital Asset Summit in New York City, Robert Mitchnick, head of digital assets at BlackRock, expressed optimism about the NYSE's proposal. He stated that allowing staking could be a "huge step change" for Ethereum ETFs, potentially attracting more investors who are looking for yield in a low-interest-rate environment.

Market Implications

Ethereum, currently the second-largest cryptocurrency with a market capitalization of approximately $237 billion, was trading at around $1,974.20 at the time of the proposal. The introduction of staking rewards could not only enhance the appeal of Ethereum ETFs but also contribute to the overall growth of the Ethereum ecosystem.

Conclusion

The NYSE's proposal to allow staking for the Bitwise Ethereum ETF marks a pivotal moment in the evolution of cryptocurrency investment products. If the SEC approves this initiative, it could lead to a surge in interest and investment in Ethereum ETFs, providing a new avenue for investors to engage with the cryptocurrency market while earning rewards. As the regulatory landscape continues to evolve, the potential for staking in ETFs may redefine how investors approach digital assets in the future.

Sources

• NYSE proposes staking for Bitwise Ethereum ETF, TheStreet.

• NYSE Files Proposal to Permit Staking for Bitwise Ethereum ETF, The Crypto Times.