The Nasdaq exchange has just submitted an application to the U.S. Securities and Exchange Commission (SEC) on behalf of BlackRock, proposing to add staking features to the company's iShares Ethereum (ETH) ETF.
If approved, this ETF will not only provide access to the value of Ethereum but also offer staking rewards to investors — income generated from using ETH as collateral in Ethereum's Proof-of-Stake (PoS) consensus mechanism.
In May, the SEC issued official guidance defining staking rewards from validation services on the PoS network as earned income, not as capital gains taxable securities transactions. This has paved the way for traditional financial institutions (TradFi) to participate in staking to generate cash flow on the ETH assets they hold.
Ray Youssef, CEO of the financial app NoOnes, commented: 'Ethereum is gradually becoming a hybrid between technology stocks and digital currency — this is very appealing to treasury strategists looking for solutions beyond passive storage.'
In the past month, companies holding Ethereum as corporate treasury have bought approximately 540,000 ETH, equivalent to 1.6 billion USD at current market prices.
The total amount of staked ETH reached a record high in June, with 28% of the total circulating supply used to secure the network. By July, this number continued to rise to 36,036,981 ETH, accounting for more than 29% of the total circulating supply, according to data from Dune Analytics.
The increased demand for ETH is also reflected in the strong cash flow into Ethereum ETF funds in June and July, following a period of stagnation earlier in the year due to macroeconomic concerns and risk-averse sentiment.
According to Farside Investors, capital inflow into ETH investment products has increased in 11 out of the last 12 sessions, with last Wednesday alone recording more than 726 million USD poured into Ethereum ETFs.
Attracting institutional cash flow is the main goal of the Ethereum Foundation in this new phase. This organization has supported the establishment of Etherealize, a marketing company specializing in introducing Ethereum to institutional investors.