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DOGE$0.0677Ethereum ETF explained: how spot ether funds and staking work
An Ethereum ETF holds real ETH and trades like a stock. How the funds work, how they differ from bitcoin ETFs, how staking fits in, and the $11.6B they hold.
Contents
An Ethereum ETF is an exchange-traded fund that holds real ether (ETH) while its shares trade on a regular stock exchange. You buy a share through a broker and get the price of ether without a wallet, a seed phrase or a crypto exchange. The main difference from a bitcoin ETF is one feature: ether can be staked to earn network rewards, and some funds now pass that income on to shareholders. According to SoSoValue data that we collect in our ETF flows table, eleven US spot Ethereum ETFs held $11.64 billion as of November 10, 2026, or about 4.6% of ether's market cap.
Below: how a spot ether fund works, how staking got into it, how it differs from bitcoin funds and from owning ETH directly, and what the numbers look like today.
What a spot Ethereum ETF is and how it works
The mechanics match a bitcoin ETF. The fund is a trust: a sponsor (BlackRock, Fidelity, Grayscale and others) issues shares, and a custodian holds the ether at the fund's addresses. The share price follows ETH minus the sponsor fee, which is taken out of the assets a little every day.
Shares are created and removed by authorized participants, which are large market makers. When demand for shares rises, they deliver ether or cash to the fund and receive new shares. When demand falls, they return shares and take the asset back. That keeps the share price close to the value of the ether in the fund. On July 29, 2025 the SEC allowed crypto ETPs to create and redeem shares in kind, meaning with the asset itself and not only with cash.
The US launch came in two steps. On May 23, 2024 the SEC approved exchange rule changes to list eight funds, and trading began on July 23, 2024, with first-day volume above $1 billion, The Block reported. Lawyers at Mayer Brown pointed to two details of that order: the shares are called Commodity-Based Trust Shares, which treats ether as a commodity and not a security, and shortly before approval every issuer removed staking from its filings.
Ethereum ETF vs bitcoin ETF: what is different
The wrapper is the same. The asset is not. Bitcoin runs on mining, and coins sitting in a fund's vault earn nothing. Ether has run on proof-of-stake since 2022: a holder can lock coins, take part in validating blocks and earn rewards (see our guide to crypto staking). So an ether fund faces a question a bitcoin fund never does: whether to stake the coins, and who gets the income.
| Bitcoin ETFs | Ethereum ETFs | |
|---|---|---|
| What the fund holds | BTC | ETH |
| Income from the asset itself | none | staking rewards, if the fund stakes |
| Supply of the asset | capped at 21 million BTC | no hard cap |
| US fund assets, Nov 10, 2026 | $92.8B | $11.64B |
| Share of the asset's market cap | 6.3% | 4.6% |
| Cumulative net inflow | $55.4B | $11.7B |
| Funds in SoSoValue data | 12 | 11 |
The figures come from SoSoValue via our flows table. The ether fund market is about one eighth the size of the bitcoin one, and liquidity reflects that: all Ethereum ETFs traded about $713 million on November 10, against $2.06 billion for bitcoin funds. We compared the two networks in Ethereum vs bitcoin.
Ethereum ETF staking: how it arrived
For their first year and a half, US funds simply held ether. Then three things happened.
- May 29, 2025. The SEC's Division of Corporation Finance issued a statement that protocol staking (solo, through a node operator, or through a custodian) is not an offer of securities. It is a staff view and not law, and it does not cover liquid staking or restaking.
- October 6, 2025. Grayscale switched on staking in its ETHE and ETH funds and described them as the first US-listed spot crypto ETPs with staking, The Block reported. In January 2026 ETHE paid shareholders $0.083178 per share, covering rewards earned from October 6 to December 31, 2025, according to Unchained.
- November 10, 2025. The IRS released Revenue Procedure 2025–31: a trust keeps its tax status while staking if it meets a list of conditions.
The IRS conditions show how staking inside a fund is built. The trust holds only cash and one proof-of-stake asset. Only the custodian has the keys. An independent staking provider does the staking, and the fund does not control it. Some coins may stay unstaked as a liquidity reserve for redemptions. The assets must be indemnified against slashing caused by the provider. Rewards, net of expenses, go to shareholders at least quarterly.
In March 2026 BlackRock launched a separate fund, the iShares Staked Ethereum Trust ETF (ETHB), while its main fund ETHA stayed unstaked. Per the ETHB prospectus, Coinbase is the custodian and staking provider, and the validators are Figment, Galaxy Digital and Attestant, Cointelegraph reported.
How much staking pays inside a fund
Less than staking directly. The ETHB page shows a 30-day staking rewards rate of 1.94% annualized as of November 10, 2026, with monthly distributions. The gross staking yield on the Ethereum network was 2.63%, according to Bitwise's staking report for the fourth quarter of 2026.
Three things explain the gap. Part of the ether sits in the liquidity reserve and earns nothing. The staking provider keeps a share of the rewards. The sponsor charges a management fee: 0.25% a year for ETHB, waived to 0.12% on the first $2.5 billion of assets for 12 months from March 12, 2026.
One thing staking does not change: a yield near 2% a year is no protection against price moves. Ether can lose that much in a single day.
What it looks like on November 10, 2026
As of November 10, 2026, US spot Ethereum ETFs held about 5.65 million ETH worth $11.64 billion, SoSoValue data shows. Ether traded near $2,070 on Binance as of 3:08 AM ET on November 11. The live price is on our Ethereum page.
| Fund | Issuer | Assets | Fee |
|---|---|---|---|
| ETHA | BlackRock | $5.91B | 0.25% |
| ETH | Grayscale | $1.86B | 0.15% |
| ETHE | Grayscale | $1.40B | 2.5% |
| FETH | Fidelity | $1.23B | 0.25% |
| ETHB (staked) | BlackRock | $0.80B | 0.25% |
| ETHW | Bitwise | $224M | 0.20% |
| Other five | VanEck, Morgan Stanley, Franklin, 21Shares, Invesco | $221M | 0.14–0.25% |
We checked ETHA's assets against the fund page: $5.91 billion as of November 10. That single BlackRock fund is about 51% of the whole market.
Flows turned sharply in recent months. The funds took in $1.85 billion in August 2026 and $0.83 billion in September, then lost $1.61 billion in October and another $0.55 billion on November 1–10. Glassnode counted 23 straight trading days of outflows in October.
The more useful point is a different one. In our series, which starts in September 2025, assets peaked at $32.0 billion on October 6, 2025. They have since dropped by $20.4 billion, or 64%, while cumulative net inflow fell by only $2.9 billion, from $14.6 billion to $11.7 billion. Roughly six sevenths of the drop in assets is the fall in ether's price, not investors leaving. Assets under management and flows are separate measures and should not be mixed up.
ETF or ether held directly
| Ethereum ETF | ETH in your own wallet | |
|---|---|---|
| Where you buy | a broker, during market hours | a crypto exchange, around the clock |
| Custody | the fund's custodian | you, with a seed phrase |
| Cost of holding | 0.14–2.5% a year | none |
| Staking | only some funds, lower yield | full yield, with your own risks and exit delays |
| Use in DeFi | no | yes |
| Tax reporting | from the broker | you keep the records |
A fund suits someone who only wants the price of ether inside a familiar brokerage account. It does not suit someone who needs ether as a network asset: to pay fees, use DeFi or choose a validator.
Outside the US these products appeared earlier. According to a CoinGecko study, the first exchange-traded ether products launched in Europe in 2017, and in early 2024 Europe held 81% of the assets in such funds worldwide. Hong Kong has had spot bitcoin and ether funds since April 30, 2024, Cboe reported. US funds are not open to everyone: brokers in the EU generally do not sell them to retail clients, who buy local ETPs instead.
Common mistakes
- Reading an outflow as ether sold for the full amount. An outflow is redeemed shares. Price also depends on trading on crypto exchanges and in derivatives.
- Judging demand by assets. Assets fall with the price of ETH even when nobody leaves. Look at cumulative net inflow.
- Expecting the full staking yield from a fund. The liquidity reserve and fees reduce it, and unstaked funds pay none.
- Ignoring the fee. The range runs from 0.14% to 2.5% a year, and over several years the difference adds up.
- Forgetting market hours. Ether trades around the clock and the fund only during the session, so shares can gap on Monday's open.
- Comparing different trackers. SoSoValue, Farside and Glassnode count differently and update at different times. Gaps of tens of millions of dollars are normal.
FAQ
Do Ethereum ETFs pay dividends? Only funds that stake. They distribute network rewards, usually monthly or quarterly. Plain spot funds pay nothing.
Do ETF flows move the price of ether? They do, as one factor among several. The funds hold about 4.6% of ether's market cap. On some days their flows are visible, on others they are lost in exchange volume.
Can I swap fund shares for real ETH? Not as a retail investor. Only authorized participants can redeem shares for ether.
How is the income taxed? It depends on the country. In the US, fund shares are an ordinary security with broker reporting, and staking distributions are accounted for separately. The general principles are in our guide to crypto taxes.
This is not investment advice.
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