REX-Osprey has pioneered a novel investment vehicle in the United States: an exchange-traded fund (ETF) that combines direct Ethereum ownership with the potential to earn staking rewards.
The launch, unveiled on September 25th, introduces the ESK ticker. Registered under the Investment Company Act of 1940, this ETF provides investors with a regulated and accessible means of engaging with Ethereum.
The ESK fund operates by holding actual ETH and incorporating a staking mechanism. Profits earned through the Ethereum network’s proof-of-stake system are then distributed to shareholders on a monthly basis.
REX-Osprey highlights a key difference from many other staking services that often involve private arrangements: they pledge to pass on 100% of the staking rewards to investors, without taking a cut.
Greg King, CEO of REX Financial, commented:
“ESK gives investors access to both Ethereum and staking rewards via a broad-based US ETF structure. This is a continuation of our effort to bring crypto staking to the ETF landscape.”
This launch follows the company’s earlier success with the first Solana Staking ETF in the US, which debuted in July. It was a groundbreaking product as both the inaugural Solana ETF and the first US-based crypto ETF offering staking-related distributions.
Since its inception, that Solana ETF has grown to manage over $300 million in assets and has transitioned to a Regulated Investment Company (RIC) structure to improve tax efficiency while maintaining its blend of direct holdings and staking rewards.
Ethereum ETF Inflow Trends
The arrival of ESK coincides with a noticeable slowdown in the rate of investment into spot Ethereum ETFs.
Data compiled by SoSo Value indicates that Ethereum spot ETFs in the US have experienced net inflows of just $110 million in September across nine products. This contrasts sharply with the $3.8 billion recorded in August and $5 billion in July. Importantly, inflows have been seen on a mere seven trading days, while outflows have occurred on ten days this month.
Overall, the cumulative inflows into these products remain significant at $13.62 billion, and the funds collectively manage $27.42 billion.
These figures could see substantial gains if the US Securities and Exchange Commission (SEC) permits the integration of staking into these ETF products. The SEC has recently extended its review period for granting this approval.