CBOE files 19b-4 form with SEC to approve staking on the Fidelity Ethereum ETF

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The Chicago Board Options Exchange filed with the Securities and Exchange Commission (SEC) on March 11 to enable staking for the Fidelity Ethereum ETF. The firm said the initiative aims to allow the fund to stake its Ethereum holdings and enhance returns for investors.

The 19b-4 form filed with the SEC indicated that Cboe BZX Exchange proposed to “amend the Fidelity Ethereum Fund to permit staking of ether held by the Trust.” Ethereum’s price surged slightly in reaction to the news and reached $1,960. The digital asset is currently exchanging hands at $1,891 at the time of publication, a 6.90% decline in the last 24 hours.

Cboe files proposal for staking in Fidelity’s Ethereum ETF

The Chicago Board Options Exchange has filed a 19b-4 form with the SEC to allow staking for the Fidelity Investment spot Ethereum Fund. Cboe hopes the initiative will enable the fund to stake its Ethereum holdings so that investors can make more returns. The firm said the staking will enable investors from the Fidelity Ethereum ETF to commit their ETH holdings to support the operations of the blockchain network.

The filing noted that the proposed rule change would allow Fidelity’s FETH fund to stake “all or a portion of the Trust’s ether through one or more trusted staking providers” once approved. It also acknowledged that any rewards generated by staking would be “treated as income.”

Validators are selected based on the number of tokens they stake in Ethereum’s proof-of-stake system, which helps secure the Fidelity Ethereum fund and process transactions. The initiative will also allow participants to earn rewards in the form of additional tokens for their contribution to the network.

The exchange noted that the Fidelity Ethereum Fund would be among the first ETFs in the U.S. to incorporate staking once approved by the regulators. The firm believes that it could offer investors a way to earn staking rewards without managing the technical aspects themselves.

Staking was left out of the proposal that saw spot Ethereum ETFs getting approved last July by the SEC. It appeared to help them gain approval and also allowed for firms like BlackRock and Grayscale to offer shares in the ETF that track the price of ETH. 21Shares and Grayscale are among companies seeking to add staking features to their Ethereum ETFs.

Bitcoin Suisse believes Ethereum ETFs will outperform Bitcoin ETFs

Crypto finance service provider Bitcoin Suisse projected that Ethereum staking exchange-traded funds could outperform Bitcoin ETFs. The company referred to the flip in capital flows in November, which had Ethereum funds outpacing BTC ETFs in daily flows. Ethereum exchange-traded funds saw $332.9 million in daily flows, while Bitcoin ETFs realized $320 million in daily flows.

“While Bitcoin ETFs shattered records with $32B in net flows and IBIT now approaching $50B in AUM in just 225 trading days, we project a structural shift of flows into ETH ETFs in the post-election environment.”

– Bitcoin Suisse Outlook 2025

Bitcoin Suisse argued that Ethereum’s underperformance was more due to BTC having a head start as an established narrative. The firm also believes that the regulatory blows that surrounded staking yields also contributed to Ethereum’s underperformance. The service provider said that the removal of regulatory bottlenecks could cause ETH ETFs to take off massively. The firm also envisioned that financial giants would launch institutional rollups on Ethereum. 

The digital asset service provider also projected that the crypto bull market would continue in 2025, with BTC reaching a new all-time high above $180,000.

The Swiss crypto investment partner said they were expecting swift approval for ETH staking in ETFs under the new Trump administration. The firm believes that ETH staking ETFs will eventually unlock a 3-4% yield. The crypto service provider also added that the fund will strongly cater to institutional allocators and will be compelling in a declining rate environment.

Bitcoin Suisse also projected that staking yields will disproportionately benefit Ethereum and emerge as the primary catalyst for sustained constructive flows into ETH ETFs. On-chain data showed that the third largest ether ETH, Fidelity Ethereum ETF (FETH), has been declining in terms of assets under management as the price of ETH declined.

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