BlackRock, the world’s largest asset manager with over $10 trillion in assets under management, has officially filed with the U.S. Securities and Exchange Commission (SEC) to enable staking for its Ethereum Spot ETF (iShares Ethereum Trust, ETHA). This proposed amendment, filed through Nasdaq on July 16, 2025, would allow BlackRock to stake part or all of the Ethereum (ETH) held in the ETF using trusted staking service providers, leveraging Ethereum’s proof-of-stake consensus mechanism to generate additional income for investors.
This move marks a significant evolution in the Ethereum ETF market, as it combines traditional exchange-traded fund investment with decentralized finance mechanisms, effectively unlocking dual investment engines: price appreciation plus staking yields. The estimated annualized yield from staking is roughly 3.5%, enabling ETH to compete with traditional income-generating assets like government bonds and dividend-paying stocks for the first time.
Institutional interest in Ethereum ETFs is strong, with over $5.5 billion having flowed into ETH ETFs recently, including $3.3 billion in the last three months alone. BlackRock’s involvement underscores the growing institutional appetite for regulated Ethereum exposure enhanced by staking returns.
The SEC’s stance on staking within ETFs has softened over time. Previously, the regulator did not allow staking in crypto ETFs, resulting in issuers removing staking features from applications. However, recent approvals for Coinbase and Kraken to offer staking have set a precedent, and BlackRock’s filing is considered a strong indicator that the SEC may soon broadly approve staking in Ethereum ETFs, potentially by Q4 2025, well before BlackRock’s final filing deadline in April 2026.
Despite the regulatory progress, a key uncertainty remains regarding the Internal Revenue Service (IRS)’s tax treatment of staking rewards earned within ETFs. How staking income will be taxed compared to other ETF earnings is not yet clear and could influence adoption pace.
If approved, this innovation could establish Ethereum as a more appealing “second bitcoin” for institutional investors, combining capital appreciation potential with regular staking income. Analysts predict that institutional entry with staking-enabled ETFs may push ETH prices toward new highs, with some forecasts suggesting levels well beyond the current $3,600 mark, potentially reaching $4,200 or even $5,000 in the next rally phase.
In summary, BlackRock’s push to integrate Ethereum staking into its spot ETF could be a game-changer in the crypto investment landscape, attracting substantial institutional capital and redefining Ethereum’s market positioning amid evolving regulatory frameworks.
This news reflects developments as of July 2025, based on SEC filings, expert analyses, and recent market data. The final impact depends on regulatory outcomes and tax rulings.