Ethereum Staking ETF Connects Conventional Finance and Blockchain, Offering Direct Yield Payouts

REX-Osprey™, a partnership between REX Shares and Osprey Funds, has introduced the REX-Osprey™

+ Staking ETF (ticker: ESK), becoming the first U.S.-listed 1940 Act ETF to give investors access to (ETH) along with monthly staking payouts REX-Osprey Launches First Ethereum Staking ETF in the U.S. [ 1 ]. This ETF allows investors to gain spot Ethereum exposure through a conventional ETF model, while also receiving staking income—a feature not present in earlier crypto ETFs REX-Osprey™ Launches First Ethereum Staking ETF in the US [ 2 ]. ESK’s approach blends directly staked ETH with other exchange-traded vehicles that both hold and stake ETH, ensuring all staking rewards are distributed to shareholders with none retained by the company REX-Osprey Launches First Ethereum Staking ETF in the U.S. [ 1 ]. This product builds on the momentum of the REX-Osprey™ Solana + Staking ETF (SSK), which launched in July 2025 and has accumulated over $300 million in assets REX-Osprey™ Launches First Ethereum Staking ETF in the US [ 2 ].

The debut of ESK highlights the increasing interest from institutions in crypto staking, a process where investors earn returns by supporting Ethereum’s proof-of-stake protocol REX-Osprey Launches First Ethereum Staking ETF in the U.S. [ 1 ]. Greg King, CEO of REX Financial, noted that ESK connects traditional financial markets with crypto by letting investors tap into Ethereum’s performance and staking rewards through a familiar ETF structure REX-Osprey Launches First Ethereum Staking ETF in the U.S. [ 1 ]. However, the fund’s design introduces specific risks. Ethereum’s price swings, regulatory ambiguity, and the technical challenges of staking—including limited liquidity during lock-up periods and risks tied to smart contracts—present notable obstacles REX-Osprey Launches First Ethereum Staking ETF in the U.S. [ 1 ]. Furthermore, the ETF’s lack of diversification and its focus on the Ethereum network make it more vulnerable to market declines or network issues REX-Osprey Launches First Ethereum Staking ETF in the U.S. [ 1 ].

Ethereum’s price volatility adds another layer of complexity for the fund. By late September 2025, ETH was trading below $4,000, down 19% from its August peak Ethereum drops below $4,000 as Rex-Osprey launches first ETF … [ 3 ]. This instability has resulted in $296 million exiting Ethereum ETFs since mid-September Ethereum drops below $4,000 as Rex-Osprey launches first ETF … [ 3 ], reflecting investor caution. Analysts point to factors such as institutional buyers entering the market at highs and growing competition from other blockchain platforms Ethereum drops below $4,000 as Rex-Osprey launches first ETF … [ 3 ]. Despite these challenges, the ESK ETF marks a significant step in REX-Osprey’s expansion into crypto, following its previous launches of

and ETFs Ethereum drops below $4,000 as Rex-Osprey launches first ETF … [ 3 ].

The ETF’s legal framework also differs from standard offerings. By using a C-corporation structure alongside subsidiaries in the Cayman Islands, ESK avoids the SEC’s 19b-4 approval process for spot ETFs, allowing for a faster launch REX Shares Files Innovative ETFs for ETH, SOL Staking [ 4 ]. While this setup meets tax requirements for staking income, it also brings certain corporate tax drawbacks REX Shares Files Innovative ETFs for ETH, SOL Staking [ 4 ]. The Cayman structure also helps the fund bypass U.S. rules that prevent grantor trust ETFs from staking, though its sustainability will depend on future IRS decisions REX Shares Files Innovative ETFs for ETH, SOL Staking [ 4 ].

Ethereum’s wider ecosystem continues to face both regulatory and technical challenges. The SEC’s recent green light for the Hashdex Nasdaq Crypto Index US, which includes Ethereum and

, shows a cautious move toward regulatory acceptance Ethereum drops below $4,000 as Rex-Osprey launches first ETF … [ 3 ]. Yet, the absence of a global consensus on crypto regulation remains a concern. Meanwhile, Ethereum’s shift to proof-of-stake in 2022 has not fully addressed worries about validator centralization, as large holders still exert considerable influence over price trends REX-Osprey Launches First Ethereum Staking ETF in the U.S. [ 1 ].