A new Ethereum staking trust has been launched by Staked to attract bigger bag holders to the new financial landscape.
Blockchain node operator Staked has dipped its toe into the crypto asset management space. It unveiled a new ETH Trust aimed at U.S.-based accredited investors.
The minimum subscription to the new product is $25,000. This equates to 15.5 ETH at current prices of just over $1,600. There is also a 12-month lockup period.
According to Staked, the Trust is the “first investment vehicle that offers the combination of digital asset exposure as well as staking rewards.”
Staking for Institutions
The Trust offers traditional investment vehicle status for a crypto product with auditable ownership. Shares are titled in the investor’s name. This provides a familiar structure for traditional investors who want exposure to Ethereum, it added.
The product is offering an annual percentage yield of 7.5% in ETH. Investors can capture both ETH exposure and a growing ETH balance due to staking rewards.
According to the ETH 2.0 Launchpad, staking on Beacon Chain currently yields an APY of 8.2%. However, this rate will diminish as more of the asset is staked.
The product page added that Staked Capital uses leading providers for staking, custody, fund administration, accounting, and transfer agent services. There are also tax advantages. Shares of the Trust are eligible to be held in certain IRA, 401k, and other investment accounts.
CEO Tim Ogilvie acknowledged that buying and staking cryptocurrency is too complicated for many institutional investors;
“That requires a lot of crypto know-how that isn’t for everyone. The trust offers an all-in-one solution to allow them to participate without deep crypto knowledge.”
Ogilvie also pointed out that Ethereum will become a deflationary asset when EIP-1559 launches later this year. This implementation will attempt to adjust the economics by burning some of the gas fees.
“So investors that like the hard cap of 21 million bitcoin will really like the ultra-sound money ETH offers.”
ETH 2.0 Staking Update
There are more than 3.64 million ETH staked in the Beacon Chain deposit contract. This equates to approximately $5.9 billion, or roughly 3.16% of the entire supply of ETH.
BeaconScan is reporting that there are 111,600 validators, a figure that has increased by 130% since the beginning of 2021.
At the time of press, ETH was trading up 2.5% on the day at $1,620. It’s now down 21% from its all-time high of just over $2,000 on Feb. 20. The Berlin Ethereum upgrade is scheduled to go live on April 14.