Ethereum News Update: Realizing PoS Capabilities: Authorities Approve Staking for ETPs

The U.S. Treasury and Internal Revenue Service (IRS) have released landmark guidance that allows cryptocurrency exchange-traded products (ETPs) to participate in staking digital assets such as

and without causing tax or regulatory issues, representing a significant advancement for the broader acceptance of proof-of-stake (PoS) blockchains. Announced on November 10, 2025, this safe harbor policy offers much-needed direction for institutional investors and fund managers, enabling ETPs to provide staking rewards to retail investors while remaining compliant with federal regulations .

According to the new rules, qualifying ETPs are required to hold a single type of digital asset from an open PoS network, be listed on a national securities exchange, and utilize approved custodians and independent staking operators. These trusts must also refrain from discretionary trading and uphold liquidity measures to guarantee that redemptions can occur even when assets are staked

. Treasury Secretary Scott Bessent stated that this initiative will "enhance investor advantages, drive innovation, and maintain America's leadership in digital asset technology" .

This move resolves persistent regulatory uncertainties that had previously discouraged traditional financial institutions from incorporating staking into their services. Staking, which involves locking up tokens to help validate blockchain transactions in return for rewards, has historically produced annual returns ranging from 1.8% to 7%, depending on the network.

For Ethereum, average staking returns over the last half-year were 2.98% based on Grayscale’s analysis, while Solana’s staking rewards typically fall between 4% and 8% . By formalizing a compliant route, the IRS and Treasury seek to attract more institutional investment into PoS networks, thereby strengthening their security and decentralization.

Industry experts have praised the guidance as a game changer. Bill Hughes, Consensys’ global regulatory lead, commented that it "removes a significant legal obstacle" for fund managers and custodians, allowing them to offer staking returns without regulatory uncertainty

. This development also complements the Securities and Exchange Commission’s (SEC) recent approval of broad listing standards for crypto ETPs, helping to create a unified regulatory landscape for these products .

From a tax standpoint, staking rewards will be recognized as taxable income for the trust when received, with investors benefiting proportionally according to their ownership. This approach is consistent with current IRS rules on digital asset taxation, which treat cryptocurrencies as property subject to both capital gains and ordinary income tax

. Retail investors can now access yield opportunities without having to directly interact with blockchain protocols, a change that analysts believe will speed up the adoption of PoS assets.

The timing of this guidance, issued during negotiations to resolve a 40-day government shutdown, highlights the administration’s focus on crypto policy. Despite the shutdown affecting agencies like the IRS and SEC, the Treasury’s timely action demonstrates its dedication to advancing digital asset innovation

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With regulatory barriers now removed, specialists expect a wave of staking-enabled ETPs to emerge, including offerings such as REXShares’ Ethereum Staking ETF, which debuted in September 2025. These products are likely to reinforce the U.S.’s position as a global frontrunner in crypto innovation, drawing both individual and institutional investors to PoS platforms

.