The U.S. Securities and Exchange Commission (SEC) has received a new filing from VanEck requesting clearance for an exchange-traded fund (ETF) linked to Lido Staked Ethereum (stETH).
Without having direct control over validator nodes or cryptocurrency custody, the idea seeks to provide institutional and retail investors with regulated exposure to staking-based profits from Ethereum’s proof-of-stake network. The returns range from 3 and 5% yearly.
Lido’s stETH token, which stands for staked ETH on the Ethereum network, is tracked by the VanEck Lido Staked ETH ETF.
To participate in staking incentives and utilize those assets across decentralized applications, users can stake Ethereum (ETH) in exchange for liquid derivative tokens through Lido, a decentralized financial protocol. VanEck’s strategy represents an increasing attempt to combine conventional markets with decentralized financial infrastructure.
What This Signifies for Staking Ethereum
Traditional investors may still use Ethereum’s economic security concept without needing to address the technical challenges of managing self-custody wallets or installing validator software.
However, regulatory concerns have also been raised by the submission. In the past, the SEC has exercised caution when certifying ETFs with a crypto component, especially those connected to innovative token structures.
Although it took years of industry pressure for the approval of spot bitcoin ETFs in early 2025, goods linked to staking incentives add another layer of complication. There may be questions about the form of custodial agreements, the level of decentralization in protocols like Lido, and whether staking rewards qualify as income from securities.
What Role Does Lido Play?
With almost 25% of all Ethereum staked on the network, Lido presently controls the majority of Ethereum staking. The Ethereum community is debating the risks of centralization due to its growing popularity.
By directing institutional investments through a single staking provider, a regulated ETF linked to stETH may exacerbate these concerns by potentially consolidating network power.
However, supporters argue that incorporating ETFs based on current staking derivatives could enhance liquidity and lend legitimacy to staking in larger financial markets.
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