BlackRock launches a new Ethereum exchange-traded fund (ETF) that incorporates staking. It marks the firm’s first crypto ETF that is designed to generate yield from blockchain validation rewards. The new product,iShares Staked Ethereum Trust, will reportedly charge the same base fee as BlackRock’s existing Ethereum ETF at 0.25%.
This move comes as the largest altcoin is facing heavy selling pressure, but its linked US ETFs have posted gains. Ethereum price has dipped marginally over the last 7 days, while Ether ETFs have managed to bag more than $57 million of inflow this week to date. However, ETH ETFs reported an inflow of $12.5 million last week.
BlackRock cuts ETHB fees to 0.12%
BlackRock’s fund will reportedly include a temporary fee waiver, lowering costs to 0.12% for the first year or until the fund reaches $2.5 billion in assets. James Seyffart noted that Coinbase will serve as both the custodian and staking provider for the fund. However, the ETF will rely on a small group of approved validators. This includes Figment, Galaxy Digital, and Attestant.
Attestant was recently acquired by Bitwise Asset Management. It is being rebranded as Bitwise Onchain Solutions, he added. Seyffart mentioned that the fund will hold spot Ethereum and stake a portion of those holdings on the network. Staking rewards earned by the ETF will then be sold and distributed to investors as dividends. He expected that it would be paid monthly.
ETHB begins trading on Nasdaq and becomes BlackRock’s third crypto ETF. The firm is already operating the iShares Bitcoin Trust and the iShares Ethereum Trust. IBIT currently manages more than $55 billion in assets. Its cumulative net inflow hovers around $62.88 billion. BlackRock’s ETHA has grown to roughly $6.5 billion, and it holds a cumulative net inflow of $11.93 billion.
Jay Jacobs, BlackRock’s U.S. head of equity ETFs, reportedly stated that some investors want exposure to Ether’s price while also capturing staking rewards that are typically available only when holding tokens directly. He added that the absence of staking in the first wave of Ethereum ETFs may have discouraged some investors from moving assets into ETFs.
Ethereum operates on a proof-of-stake system. This allows token holders to lock coins to validate transactions and secure the network. Those participants receive rewards in return, which is a feature that many investors view as similar to yield. However, there are several other advantages to it. This includes institutional custody and access through brokerage accounts. It also has the ability to integrate the asset into traditional portfolios alongside stocks and bonds.
ETH ETF investors are sitting on heavy losses
Robert Mitchnick, the firm’s global head of digital assets, highlighted that combining spot Ether exposure with staking rewards creates another way for investors to participate in the Ethereum ecosystem. He added that as the world’s second-largest digital asset, ETH plays a central role in the long-term growth of blockchain adoption
Earlier, Bloomberg’s Seyffart, in a post, mentioned that the average cost basis for ETH ETF holders sits near $3,500, while Ether has recently traded closer to $2,000. The launch comes as existing Ethereum ETF investors face high unrealized losses. This leaves the holders with around 43% unrealized loss on average. The drawdown is reflecting a similar decline in April 2025 when ETH fell more than 60% before recovering.
He added that despite the downturn, most investors have held their positions. Net inflows into Ethereum ETFs have declined from about $15 billion to just under $12 billion. This is a much worse selloff than the Bitcoin ETFs on a relative basis, but still fairly decent diamond hands in the grand scheme.
Ether’s price has dropped by more than 33% in the last 90 days. It has dipped by around 30% since the beginning of this year. After witnessing a minor recovery, ETH is trading at an average price of $2,071 at the press time.
Source: https://www.cryptopolitan.com/blackrock-bets-on-ether-staking-with-new-etf-launch/
