- ETH-USD
+0.58%
Scott Melker breaks down Fidelity‘s decision to add staking rewards to its ethereum ETF, explaining why offering staking yield has become an essential requirement for crypto ETF providers to stay competitive.
“The Daily Wolf with Scott Melker” airs every day at 12:00 p.m. Tune in for your daily dose of all things crypto.
Make sure to also check out Yahoo Finance’s new crypto hub to find the latest crypto-related news.
Fidelity adds staking payments to Ethereum ETF. So this is a long time coming, no surprise here.
Fidelity, Fidelity. I always say Fidelity and they get corrected. Fidelity.
filed to add staking to its roughly $900 million FETH Ethereum ETF. Now, they’re allowed to stake as much as 100% of the ETH and 85% of that will be passed along as gross staking rewards paid as a monthly uh distribution. The remaining 50 15% will go to Fidelity, custodians, node operators and other service providers.
So Fidel’s not the first to do this. The story isn’t that we’re getting staking inside an ETF, that’s already happening. That happened with Grayscale before.
The story is that they have to do it, right? Why would you ever buy an Ethereum ETF when there’s a native yield by staking Ethereum that exists and not capture any of that yield?
You’d be better off just buying Ethereum and staking it.
So offering this with the 85% of it uh being distributed is a no-brainer and a necessity, but clearly fidelity and others participating in the crypto industry and creating products that are far more compelling.
Listen, yield is no longer a four-letter word. Everybody wants it and this makes this a much more compelling product to own.
