SEC to Review Proposal for Staking in Ethereum ETF

CBOE BZX has submitted a proposal to the SEC via form 19b-4, requesting approval for staking in a spot exchange-traded fund (ETF) based on Ethereum from 21Shares.

SEC has *acknowledged* Cboe’s 19b-4 filing seeking approval of staking in 21Shares Core Ethereum ETF…

No surprise, but nice to see progress. pic.twitter.com/DoM0HbmSse

— Nate Geraci (@NateGeraci) February 19, 2025

If approved, 21Shares Core Ethereum will begin generating additional profits, which could potentially be directed to investors.

The initiative emerged amid the launch of a cryptocurrency task force at the SEC.

The priorities of the structure are to determine which assets are not securities and to create a clear procedure for registering new tokens.

“The sponsor’s staking-related activities on behalf of the Trust will not constitute DPoS and will not be part of a staking-as-a-service offering,” the document states.

Previously, the NYSE Arca submitted a similar application for Ethereum-based exchange-traded funds from Grayscale.

The former SEC leadership regarded PoS tokens as “securities.” This led to the exclusion of the staking option from proposals to launch ETH-ETFs.

Known as “crypto mom,” SEC Commissioner Hester Peirce suggested a change in the agency’s stance following a change in its composition.

According to the latest SEC 13F filings, in the fourth quarter, the share of institutional investors in Ethereum ETFs increased from 4.8% to 14.5%.

SEC to Review Applications for Listing Digital Asset-Based Instruments

Nasdaq has submitted to the SEC a proposal to add Nasdaq Rule 5712, allowing the listing and trading of so-called “digital asset-based investment interests.”

This includes:

• securities issued by organizations that hold cryptocurrencies — for example, companies or funds holding Bitcoin or Ethereum;
• investment products based on commodities — products related to cash, derivatives, or other sources tied to digital assets.

It is also proposed to transfer the listing and trading of the Hashdex Nasdaq Crypto Index US ETF, registered under another rule, in accordance with Nasdaq Rule 5712.

The statement indicates that the proposal aims to change the investment objective and strategy of the structure.

Hashdex Nasdaq Crypto Index US ETF invests in Bitcoin and Ether but may hold other assets depending on the U.S. regulatory framework.

The initiative emerged amid SEC plans to change cryptocurrency regulation. Specifically, the agency intends to clarify which digital assets are securities.

Earlier, Nasdaq launched trading of options on BlackRock’s spot BTC-ETF (IBIT).

In less than two months, open interest in IBIT derivatives reached half the level on Deribit.

In January, Nasdaq, on behalf of BlackRock, filed an application to change the structure of the instrument to allow asset redemption in kind.

A similar proposal followed from CBOE on behalf of ARK Invest and 21Shares regarding Bitcoin and Ethereum ETFs.