BlackRock meets with SEC Crypto Task Force to discuss staking and options on crypto ETFs

Wall Street powerhouse BlackRock held a meeting with the U.S. Securities and Exchange Commission’s (SEC) Crypto Task Force to discuss staking in crypto exchange-traded products (ETPs) and tokenization of traditional securities. The company said it wanted to discuss how staking should be treated, including the possibility of allowing exchange-traded products (ETPs) to offer staking features. The company noted that while Ether ETFs have been successful, they are incomplete without the ability to stake. BlackRock’s current Ether ETF filing does not describe staking. However, the firm also believes that Ethereum ETFs are missing out on the full value without staking. During the meeting, the asset manager said it wants to offer Ether ETFs that can engage in staking so investors can earn additional yield. Other leading crypto ETF players, such as Grayscale and some regulators, agree. Grayscale also filed for rule changes to bring staking to its Ether ETF. In April, the SEC postponed its decision on Grayscale’s proposal. That demonstrates how carefully the regulator is tiptoeing into staking features. Even then, if the SEC permits staking in Ether ETFs, it could pave the way for similar ETFs based on other cryptocurrencies that also use proof-of-stake, such as Solana or Cardano. BlackRock explores blockchain tokenization of traditional assets In addition to staking, BlackRock spoke about tokenizing products from the traditional world of finance — such as bonds, real estate, or other assets. This entails converting assets such as bonds or stocks to blockchain-based tokens. Tokenization is a hot topic in finance. It has several advantages, like shorter settlement times, lower fees, and the ability to trade around the clock (unlike traditional markets, which close on weekends and holidays). The asset manager already dominates this field with its digital fund “BUIDL.” This fund is known as a tokenized or STO (security token offering) fund comprising U.S. Treasury assets. The Ethereum blockchain powers it and holds about $2.9 billion in digital currency. That makes it the largest fund of its kind anywhere. Franklin Templeton also operates in this ecosystem, launching its “BENJI” tokenized fund. The two firms are among the early movers in a market that could transform securities trading. Brokerage firm Robinhood is said to be developing its blockchain. The plan is to allow individual European investors to trade U.S. shares in tokenized form. If successful, it could upend traditional financial firms and inject more transparency and speed into trading. BlackRock–SEC talks signal rising institutional interest This is the second time BlackRock has gone to the SEC’s Crypto Task Force this year. The inaugural session was held on April 1 and focused on the firm’s proposed Ethereum ETF. These ongoing discussions hint at growing interest from big finance for crypto-linked products. They also indicate that the SEC is receptive to hearing from the public but cautious. Only a handful of spot Bitcoin ETFs have been approved by the SEC, with the first one from BlackRock in January 2025. That’s one of the most important things ever. But the chatter is now around Ethereum. What are Ethereum’s new ETFs likely to include? The SEC has not yet decided whether it should let staking happen. But when such calls are coming from the likes of BlackRock and investor demand has been increasing for more inventive strategies, a decision may not be far off. A decision favoring the ETFs could set off a burst of new ones, offering investors more opportunities to profit from digital coins — and further eroding the wall between mainstream finance and blockchain tech.