Grayscale, a leading investment management firm in the cryptocurrency space, has announced the launch of staking features for its Ethereum and Solana exchange-traded products (ETPs) as of October 6, 2023. This move positions these ETPs as the first U.S.-listed spot crypto offerings to incorporate staking.
Investors can now stake Ether through the Grayscale Ethereum Trust (ETHE) and the Grayscale Ethereum Mini Trust (ETH). Additionally, the Grayscale Solana Trust (GSOL) has activated staking for Solana (SOL). According to data from SoSoValue, ETHE currently boasts approximately $4.82 billion in assets, while ETH holds over $3 billion.
A notable detail is that neither ETHE nor ETH are registered under the Investment Company Act of 1940, which means they do not face the same regulatory constraints as traditional mutual funds or exchange-traded funds. Meanwhile, GSOL is trading on the OTC Markets and is awaiting regulatory clearance to become an ETP; if approved, it would become one of the pioneering spot Solana ETPs providing staking capabilities through conventional brokerage accounts.
Grayscale asserts that this initiative allows investors to earn staking rewards while maintaining the primary focus of gaining exposure to spot Ethereum and Solana. As of the most recent trading data, Ether is valued at approximately $4,716, and Solana is trading at around $237.
“By facilitating staking within publicly listed, spot-based ETPs, we make it possible for investors to access staking rewards through the conventional brokerage accounts they already use, with no additional steps required,” noted Zach Pandl, Grayscale’s Head of Research, in an interview. “This development renders Ethereum—and soon Solana—more liquid, secure, and cost-effective for staking compared to existing alternatives.”
Pandl further highlighted the benefits of staking in reinforcing network security, while also serving as a unique source of returns at a time when traditional yields are declining. This is especially relevant following the recent implementation of the GENIUS Act, which has led to reduced returns on stablecoin deposits, prompting investors to look for alternative income streams in the crypto landscape. Staking rewards from ETH and GSOL are intended to be incorporated into their net asset values (NAV) for compounding purposes, while ETHE plans to distribute rewards monthly.
Grayscale, which was established in 2013, currently manages around $35 billion in assets. It is also the issuer of the Grayscale Bitcoin Trust (GBTC), which oversees approximately $21.7 billion in net assets. The introduction of staking for its Ethereum and Solana products is part of Grayscale’s broader strategy to expand and diversify its offerings within the cryptocurrency sector. Earlier this year, the firm launched an investment trust for the native token $IP of the Story Network, a blockchain dedicated to programmable intellectual property. Moreover, in July, the U.S. Securities and Exchange Commission (SEC) approved Grayscale’s proposal to transform its Digital Large Cap Fund into a spot ETF, which enables diversified exposure to key digital assets such as Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Solana (SOL), and Cardano (ADA).
