An explosive week for Ethereum 💥

Ever since the first spot Bitcoin ETFs were approved in January, people have been speculating on when we'd see Ethereum follow in its footsteps.

Turns out we didn't have to wait long.

Ethereum spiked nearly 25% in a single day this week when rumors started to spread over ETF filings, and just days later (May 23rd, 2024) they've already been approved.

There's just one small catch.

ETH ETF issuers had to confirm in their filings that they would NOT stake their holdings for yield via the blockchain's proof of stake validator process.

Why can't ETF Ethereum be staked?

Ethereum staking is a process where individuals can participate in the network's consensus mechanism, known as Proof of Stake (PoS). To become a validator, a participant must lock up a certain amount of ETH in a special smart contract. This staked ETH acts as a security deposit that ensures the validator acts honestly.

Validators are responsible for proposing and validating new blocks on the Ethereum blockchain. When they do this work correctly, they earn rewards in the form of additional ETH. These rewards are distributed periodically, providing an incentive for validators to maintain network integrity.

While the decision to not allow staking for ETF traded ETH funds hasn't been discussed publicly by anyone from the SEC, it is assumed that the mechanism was left out of updated ETF filings in an attempt to avoid giving the SEC any additional reasons to object the proposal.

Fortunately, for those still looking to stake and earn yield on their ETH, there are still plenty of great options out there. Buying an ETF gets you shares in a fund that invests into Ethereum, but if you actually want to own your Ethereum AND earn yield on top, a self-custody app like Giddy is your best bet.

So who's up next for an ETF?

CNBC's in-house digital currency expert Brian Kelly says, "I think you've gotta think about Solana (...) I mean Bitcoin, Ethereum, and Solana are probably the big three for this cycle."

Others chimed in that it soon might be time for a blended crypto ETF. (Giddy users can already earn with our 'Wealth Blend' in this way, but we'll let them think they came up with it for now.)

It's unclear if Solana, or some other top-10 crypto will achieve the institutional support necessary to get its own ETF, but the future has truly never looked brighter for crypto, so we'll just have to wait and see. 

Try Giddy to start earning with Ethereum today.

- Joey Segura