Grayscale: ETH-based spot funds lost $61 million due to the staking ban

What’s new? Investment firm Grayscale is urging the US Securities and Exchange Commission (SEC) to allow Ethereum (ETH) coins purchased on behalf of investors in exchange-traded funds (ETFs) based on the largest altcoin with a capitalization of $218,7 billion to be placed in staking. To that end, Grayscale met with members of the SEC’s Crypto Task Force in Washington, DC.

Material by Bitcoin com

What else is known? Specifically, Grayscale asked for permission to amend its already approved Form 19b-4 filings for the Grayscale Ethereum Trust ETF (ETHE) spot exchange-traded fund and the Grayscale Ethereum Mini Trust ETF (ETH), which have $2,07 billion and $858,76 million in coins under management, respectively.

The Form 19b-4 filing is a required step to launch exchange-traded products in the United States. It is filed jointly by the issuing company of the exchange-traded product and the stock exchange on which it will be listed. Grayscale crypto funds are listed on the NYSE.

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During the meeting, Grayscale noted that outside the US, placing ETH into staking on behalf of fund investors is permitted, allowing for additional returns. Specifically, it is allowed in Canada, Hong Kong, and countries in Europe.

As for the US, a total of nine spot ETH ETFs are listed on local stock exchanges, including those from leading investment firms BlackRock and Fidelity, and collectively they have accumulated $8,1 billion worth of coins under management.

Meanwhile, US ETH ETFs have missed out on about $61 million due to their inability to participate in staking, if you count from the time the SEC allowed such products to market on July 23, 2024, through February 2025. Instead, such rewards have gone to foreign crypto funds and other stakers that are not ETF issuers, Grayscale explained.

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The company emphasized the benefits of staking, noting that the funds’ participation in this activity will strengthen the security of the Ethereum network and bring additional returns to shareholders.