Will Non-Staked ETH ETFs Prosper Under Full SEC Scrutiny?

Regulatory concerns are forcing Ether ETF issuers to abandon staking plans, sparking mixed opinions in the community and debates over attractiveness for investors.

Several high-profile Ether exchange-traded fund (ETF) issuers—including Ark Investments Management and Fidelity Investments—have removed staking from their plans due to regulatory pressures from the U.S. Securities and Exchange Commission (SEC).

Strategic shift to eliminate staking may improve Ether ETF's chances of approval

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, but has caused concern and debate in the cryptocurrency industry due to the staking functionality.

Staking—locking cryptocurrencies to validate transactions in exchange for rewards—is a priority for many investors. The lack of staking in Ether ETFs could significantly impact their attractiveness compared to outright purchases of Ether in favor of staking for yield.

Brian Rudick, senior strategist at GSR, stressed that there would be an “immediate opportunity cost” to holding Ether through an unstaked Ether ETF.

Built using the proof-of-stake (PoS) mechanism, destaking Ether ETFs could have broader implications for supply, network security, and reduced decentralization due to less staked ETH .

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