Fidelity Cleared to Stake Up to 100% of Its Ethereum and Solana ETF Holdings

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Fidelity Cleared to Stake Up to 100% of Its Ethereum and Solana ETF Holdings

Fidelity has secured regulatory approval to stake up to 100% of the assets held in its spot Ethereum (FETH) and Solana (FSOL) exchange-traded funds, a significant step that could reshape how these products generate returns. The amendments to the funds’ prospectuses, first reported by CryptoSlate, allow the asset manager to actively stake the underlying tokens, a move that aligns with a broader trend of integrating proof-of-stake rewards into traditional financial products.

Staking at Scale: What Fidelity’s Move Means

As of June 30, FSOL was already staking 99.64% of its holdings, indicating that the fund had been operating near its new limit even before the formal approval. FETH, on the other hand, is expected to begin staking soon after a rule change on Aug. 21. The approval comes after months of regulatory discussions and reflects a growing acceptance of staking as a legitimate yield-generating mechanism within the ETF structure.

Staking involves locking up tokens to help secure a blockchain network, with validators earning rewards in return. For ETF holders, this means the fund can generate additional income, potentially offsetting some of the costs associated with managing the product. However, it also introduces new risks, particularly around liquidity and redemption timing.