ETC Group, a leading provider of digital asset-backed securities, has recently expanded its cryptocurrency product offerings by launching an Ethereum (ETH) staking exchange-traded product (ETP). The new ETC Group Ethereum Staking ETP, known as ET32, has been listed on Deutsche Börse’s Xetra platform. This development allows investors to not only gain exposure to Ethereum’s price but also benefit from additional staking rewards, as announced in a press release on Tuesday.
With a total expense ratio (TER) of 0.65%, ET32 is specifically designed to meet the needs of institutional investors looking to leverage the potential of Ethereum. The ETP tracks the Compass Ethereum Total Return Monthly index, a benchmark tailored to meet the requirements of institutional investors. By engaging in staking, which involves depositing crypto assets on the blockchain to validate transactions, investors can earn rewards from both Ethereum’s price fluctuations and the staking rewards generated.
It is important to note that a 10% staking service fee will be deducted from the total rewards received. ETC Group has highlighted that the current staking yield market is around 3.5%, although this figure is subject to change based on network activity and the total amount of Ethereum being staked. The ETP’s tracking of the Compass benchmark allows investors to evaluate performance accurately in relation to the Ethereum staking market, offering a cost-effective, liquid, and transparent staking ETP tailored for institutional-grade investors.
Chanchal Samadder, Head of Product at ETC Group, emphasized the increasing recognition among institutional investors of the differences between Bitcoin and Ethereum. As institutional players expand their expertise and dedicated teams in the cryptocurrency space, there is a growing appreciation for Ethereum’s unique attributes and potential value.
ET32 is fully backed by Ethereum, with the digital assets securely stored in cold storage by Zodia Custody and staked through Blockdaemon. This setup ensures a robust custody solution and reliable staking infrastructure to safeguard investor interests. In a similar move, CoinShares, a prominent digital asset investment firm, has also introduced staking capabilities for its Ethereum ETP to help reduce costs for investors. The CoinShares Physical Staked Ethereum ETP offers an annual staking reward of 1.25%, offsetting the product’s 1.25% TER.
Looking ahead, there is optimism in the market regarding the potential approval of a spot Ether exchange-traded fund (ETF) by the United States Securities and Exchange Commission. Current odds suggest a 45% likelihood of a spot Ether ETF approval by May 31, with Bloomberg’s Eric Balchunas forecasting a 70% chance of approval for Ether ETFs. Several Ethereum spot ETF applications, including those from VanEck, Ark 21Shares, and Hashdex, are awaiting approval decisions by the end of May.
Bitwise crypto research analyst Ryan Rasmussen estimates a 50% chance of approval for a Spot Ether ETF by May. The prospect of these ETFs has garnered attention from institutional investors, as highlighted in a recent Yahoo Finance interview. Year-to-date, Ether has seen a 40% increase in value, trading at $3,203, while Bitcoin has experienced a 32% increase, trading at $55,656. Additionally, Coinbase has expressed support for Grayscale’s application to convert its Ethereum Trust into a spot Ether ETP, further indicating growing interest and developments in the cryptocurrency market.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
