BlackRock files S‑1 for U.S. Ethereum staking ETF, proposes ETHB with yield features

BlackRock moved to launch an exchange‑traded trust that will actively stake Ethereum and distribute net rewards to holders. The filing seeds the trust with 4,000 shares at $25 apiece, totaling $100,000 in initial capital, and lists the prospective ticker ETHB. The trust aims to keep a substantial portion of its ETH staked—targeting roughly 70%–95% under normal conditions—while leaving 5%–30% unstaked to support liquidity and fund operations. BlackRock references market benchmarks that indicate staking yields near 3% annualized in early 2026, but underscores that such rates can shift with validator participation and network dynamics. The fee structure contains two payout layers: an upfront sponsor fee set at 0.25% annually, with a temporary reduction to 0.12% for the first $2.5 billion in assets during the initial 12 months, and an allocation that grants the sponsor and the execution agent an 18% share of gross staking rewards. Coinbase Prime is identified as the execution partner, creating an operational linkage between institutional custody infrastructure and BlackRock’s index capabilities. Structurally, this ETF differs from a pure spot-product because it converts a portion of underlying ETH into staking participation, introducing yield generation and an additional revenue split that affects net returns. If gross staking yields hover around the referenced 3%, a simple illustrative math shows gross rewards less the 18% cut equals ~2.46% before applying the sponsor fee, which would yield approximately 2.21%–2.34% net depending on the promotional waiver. The listing would position BlackRock’s staked product alongside its existing iShares spot Ethereum fund, offering investors a choice between pure price exposure and yield-bearing exposure. Market implications include potential downward pressure on independent staking rates as institutional flows consolidate validator rewards and operational economics under large custodial programs. The S‑1 appears in the context of other recent U.S. registration activity where sponsors have explicitly contemplated staking within ETF wrappers—filings that name custodians and staking partners and that, together with UK approvals of retail staking ETPs, form a developing cross-jurisdictional precedent. Given those dynamics, regulators and tax authorities in the U.S. will likely scrutinize accounting for staking rewards, NAV treatment, custody and counterparty arrangements, and disclosures around validator selection or delegation.