Essential Guide: Grayscale Declares First Ethereum Staking Payout For Us-listed Etf
The cash distribution stems from staking rewards earned after the fund enabled Ethereum staking in October.
Grayscale has declared a staking rewards distribution for its Ethereum Staking exchange-traded fund (ETF), the first time a US-listed spot crypto exchange-traded product (ETP) has scheduled a payout tied to onchain staking activity.
Grayscale Ethereum Trust ETF (ETHE) shareholders will receive about $0.08 per share from proceeds of the sale of staking rewards, with the payout scheduled for Tuesday based on holdings recorded at market close on Monday, according to a press release published on Monday.
Grayscale activated staking for its Ethereum products on Oct. 6, with staking conducted through institutional custodians and third-party validator providers. The move made ETHE and Grayscale Ethereum Mini Trust ETF (ETH) the first US-listed spot crypto ETPs to gain exposure to Ether staking.
Staking is the process of locking up cryptocurrency on a proof-of-stake blockchain to help validate transactions and secure the network in exchange for periodic rewards. In the case of Grayscale’s Ethereum Trust ETF, rewards are converted to cash and distributed to investors in dollars rather than being paid out in Ether (ETH).
Grayscale’s funds operate outside the Investment Company Act of 1940, the primary statute governing US ETFs, a structure that permits staking but carries different regulatory protections as traditional US ETFs.
Founded in 2013, Grayscale Investments is a digital asset manager that sponsors crypto investment products, with about $31 billion in assets under management, according to the company.
The ETF was up around 2% in early-day trading, according to Yahoo Finance data.
Related: Bank of America lets wealth advisers recommend Bitcoin ETFs
While Grayscale is currently the only US-traded fund to issue payouts linked to Ether staking, several spot Ether ETFs from major asset managers are awaiting regulatory approval from the US Securities and Exchange Commission.
Source: CoinTelegraph
