The US SEC approved Ethereum spot ETF trading in July, but its popularity in the traditional financial market has not been as high as BTC. This is due to Ethereum’s technology-oriented narrative not impressing the traditional market and the continued selling pressure from grayscale ETHE and the SEC’s prohibition on Ethereum spot ETFs from participating in the pledge function.
However, with the expected introduction of a staking function, the appeal of Ethereum spot ETFs is expected to increase. Bitwise and 21 Shares AG have already introduced staking functionality to their products. With the departure of SEC Chairman Gary Gensler, the probability of introducing a staking function to Ethereum spot ETFs may increase.
This change will directly benefit Ethereum and indirectly benefit the pledge and re-pledge sectors. Other companies providing staking services, such as Coinbase, are expected to benefit from the increased demand for staking services. However, even if the Ethereum spot ETF introduces the staking function, it may not directly benefit all liquid pledge tokens (LST) or liquid re-pledge tokens (LRT) native to the cryptocurrency world.
ETF issuers may acquire pledge service providers on their own or choose platforms with better reputations. Overall, the rebound of the pledge and re-pledge sector is still mainly driven by market sentiment in the short term, but the introduction of a staking function to Ethereum spot ETFs is expected to have a positive impact on the long-dormant Ethereum ecology.
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