Wednesday afternoon, the U.S. Securities and Exchange Commission (SEC) responded to a filing from Cboe BZX Exchange, representing 21Shares, which is seeking public comments on a proposal that would allow the 21Shares Core Ethereum ETF to engage in staking activities with its ether (ETH) holdings.

Should the SEC grant approval, this move could enable the ETF to realize additional returns from its ETH assets, which might then benefit investors.

The filing clarifies that the staking would be conducted solely with ether owned by the Trust and would not involve "delegated staking" or be part of a "staking as a service" offering. This initiative follows a similar filing by NYSE Arca last week, which sought permission for staking within Grayscale's Ethereum ETFs.

The SEC's stance on cryptocurrency has evolved over time, with spot Ethereum ETFs receiving approval last summer. Many firms subsequently removed staking from their registration statements.

Under the previous SEC Chair Gary Gensler, proof-of-stake tokens were classified as securities. However, the SEC's approach to crypto became more accommodating during the Trump administration, which included the establishment of a crypto task force. This task force is now considering the classification of certain tokens as "non-securities."

The potential for a legal framework supporting staking was highlighted in December by YouHodler's Chief of Markets Ruslan Lienkha, who suggested that such regulation could lead to wider adoption and institutional engagement.

Lienkha noted that Ethereum, with its additional yield-generating opportunity through staking, could attract more liquidity.

Recent 13F filings indicate a growing institutional interest in Ethereum ETFs, with ownership surging from 4.8% to 14.5% in the fourth quarter. Conversely, ownership of Bitcoin ETFs saw a slight decrease from 22.3% to 21.5% during the same period.

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