The development of spot exchange-traded funds (ETFs) for Ethereum (ETH)
$
1,988 is gaining momentum, particularly with the potential for these funds to earn returns through staking. Robert Mitchnick, Head of Digital Assets at BlackRock, noted that allowing Ethereum ETF issuers to stake could create additional demand. On the same day, the New York Stock Exchange (NYSE) Arca submitted a rule change to the U.S. Securities and Exchange Commission (SEC) that would enable Bitwise’s spot Ethereum ETF to earn returns through staking.
Can Spot Ethereum ETFs Generate Returns Through Staking?
Mitchnick believes that staking represents the next phase in the evolution of Ethereum ETFs. Speaking to CNBC, he stated, “Staking returns are a significant part of generating investment returns in this area, and currently, staking is not available in Ethereum ETFs on the market.” Notably, in 2024, major issuers like BlackRock and Fidelity managed to launch Ethereum ETFs without staking approval. During the tenure of former SEC Chair Gary Gensler, there was a cold reception to staking, and possibilities in this area were largely overlooked. However, hopes have increased for the inclusion of staking in ETFs with a more crypto-friendly administration expected to take power by 2025.
Ethereum ETFs Are Lagging Behind Bitcoin ETFs
Despite attracting billions of dollars in investment, spot Ethereum ETFs in the U.S. have significantly lower volumes compared to the historical success of Bitcoin 
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84,727 ETFs. BlackRock manages approximately $2.3 billion in its Ethereum ETF, while its Bitcoin ETF manages about $48 billion. 
Spot Ethereum ETFs Experts suggest that the inclusion of staking in Ethereum ETFs could enhance investor interest. Indeed, Mitchnick stated, “Some complex challenges need to be resolved. However, if this is feasible, we could see significant activity in Ethereum ETFs.” Staking is regarded as a common way to earn passive income from Ethereum investments, and expectations are strengthening for ETFs to be part of this process.
What Is an Ethereum ETF?
An Ethereum ETF is an exchange-traded fund that operates based on the price of ETH. Investors can gain exposure to the largest altcoin without directly purchasing ETH through Ethereum ETFs, thus accessing ETH in compliance with traditional market regulations.
