The New York Stock Exchange (NYSE) has officially filed a request with the U.S. Securities and Exchange Commission (SEC) to introduce staking services within the Grayscale Ethereum ETFs. This move, submitted via a 19b-4 application on Friday, seeks to amend the provisions of the already-approved Grayscale Ethereum Trust and the Grayscale Ethereum Mini Trust, allowing Ethereum staking to provide additional rewards for participants.

Staking involves locking up Ethereum to act as a validator, contributing to the network’s stability and security. In return, participants receive passive rewards through staking, with Ethereum’s average annual reward rate ranging between 3% and 4%. The proposed rule change aims to allow holders of the Grayscale Ethereum ETFs to earn these rewards, enhancing the value proposition for Ethereum investors.

The NYSE’s filing makes a clear case that the proposed staking model does not contradict any existing securities laws. The exchange stressed that the staking services would differ from delegated staking or staking as a service, both of which are classified as securities by the SEC. Under previous leadership from Gary Gensler, the SEC had expressed concerns about staking activities on Ethereum being considered unregistered securities. This came after the approval of Ethereum spot ETFs, but with a stipulation that issuers could not stake their Ethereum holdings.

James Seyffart, an analyst for Bloomberg ETF, speculated that the SEC is likely to make a decision on the rule change by the fourth quarter of 2025. This proposed move is part of a broader shift within the crypto space, as regulators and market operators explore ways to adapt to the growing demand for cryptocurrency-related investment products.

In addition to the NYSE’s filing, the Chicago Board Options Exchange (CBOE) BZX Exchange has also submitted a similar request for Ark Investment’s 21Shares Core Ethereum ETF. This trend reflects a growing push within the industry to integrate staking services within exchange-traded funds, providing investors with an additional source of passive income while holding Ethereum.

The ongoing efforts to amend regulations surrounding staking and ETFs also align with broader regulatory movements within the U.S. SEC. A recent example of this is the SEC’s decision to pause its legal proceedings against Binance for 60 days and the repeal of the SAB 121 rule, both steps signaling a shift toward a more supportive environment for the cryptocurrency industry.

As the SEC continues to review these proposals, the inclusion of staking in Ethereum ETFs could represent a significant development for both Ethereum investors and the broader cryptocurrency market. If approved, it would offer a new avenue for Ethereum holders to earn rewards and further integrate staking into the traditional financial system, fostering greater participation in the Ethereum ecosystem.

In conclusion, the NYSE’s request to add staking services to Grayscale’s Ethereum ETFs marks a pivotal moment in the evolution of cryptocurrency investment products. This proposal could reshape the way investors engage with Ethereum, providing an exciting opportunity for passive rewards while maintaining their ETF investments. However, the final decision rests with the SEC, and the crypto community is eagerly awaiting the regulator’s response.