Asset manager 21Shares has launched an Injective exchange-traded product (ETP) on Euronext exchanges. Injective thus joins a small group of cryptos available to investors through traditional financial products.

The Injective Staking Exchange Traded Product (AINJ) will track the performance of Injective (INJ) and capture staking yield for reinvestment in the ETP. Injective is a decentralized blockchain designed for financial applications.

The ETP will be physically backed by INJ kept in cold storage by a custodian. It will trade on the Euronext Paris and Euronext Amsterdam exchanges with the support of 25 financial institutions, including such large players as Interactive Brokers, Saxo Bank, Swissquote and eToro.

AINJ has $128.6 million in assets under management and charges a fee of 2.5%. Securities listed on Euronext markets are regulated under the single Euronext Rule Book, which harmonizes all applicable regulations where it operates.

One more fund with staking 

Because Injective uses a proof-of-stake consensus mechanism, AINJ can stake INJ to secure the network and receive rewards for it. 21Shares stated in a report released last year that it stakes only a portion of the assets underlying its ETPs to guarantee liquidity for investor redemptions.

According to Coinbase, INJ is paying an estimated 19.38% staking reward at the time of writing, and the rate is falling. INJ has a market cap of $2.4 billion.

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A variety of staking ETPs are available in Europe. 21Shares launched an Ethereum staking ETP in 2019. It launched the Staking Basket Index ETP (STAKE) with seven underlying coins last year. CoinShares began offering eight ETPs with staking in Germany last year.

Fidelity proposed a similarly structured Ethereum fund in the United States, but later changed its S-1 application to the Securities and Exchange Commission to remove the staking feature. Grayscale introduced the Grayscale Dynamic Income Fund targeted to qualified US investors in March. Grayscale specified that the fund would prioritize staking income over capital growth.

A boost  for INJ

Injective debuted on the Cosmos ecosystem in 2021 with backing from Binance and investor Mark Cuban. It integrated with the Ethereum and Solana chains in 2022. In an overview published on July 4, 21Shares noted that the chain has only 60 validators and:

“Ranking outside the top 50 in TVL [total value locked] at $105M among all chains indicates that Injective needs to increase its user base and liquidity to compete effectively with higher-ranking protocols.”

It has competitive advantages in its open liquidity pool and real-world asset module, the report added.

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