ARK Invest and 21Shares have altered their proposed spot Ether exchange-traded fund (ETF) by dropping staking support from their plan.
In September 2023, ARK Invest and 21Shares jointly applied for a spot Ether ETF. The proposed ETF was all set to trade on the Cboe BZX Exchange, with the exchange intending to utilize the CME CF Ether-Dollar Reference Rate – New York Variant for its operations.
Initially, 21Shares expected to receive Ethereum tokens as rewards from staking. These earnings were designated to serve as income generated by the fund. However, in a recent filing, this section was dropped. Instead, ARK Invest and 21Shares opted to remove staking plans from their ETF proposal, indicating that the dynamics of their proposed fund have shifted.
That said, the updated filing contained broader comments discussing potential risks associated with staking. This includes losses due to slashing penalties, temporarily inaccessible funds during bonding and unbonding, and potential impacts on Ether's price. However, the specific plans for staking through third-party providers have been scrapped entirely.
Meanwhile, the Securities and Exchange Commission has been delaying decisions on various ETF proposals, including those from VanEck, Grayscale, and Franklin Templeton, among others. Notably, the SEC must decide on VanEck’s spot Ethereum application by May 23, followed by ARK and 21Shares’s application on May 24.