BlackRock's Ethereum staking ETF charges an 18% commission on staking returns
According to Fortune, BlackRock's iShares Staked Ethereum Trust (ticker ETHB) launched today, with a management fee of 0.25% (temporary promotional rate of 0.12%). It also charges an 18% commission on the total staking yield from approximately $318 million in staked ETH, which is shared between BlackRock and Coinbase.
Based on the current staking yield of about 2.74% for ETH, the 18% commission roughly equates to a total return of 49 basis points. Falconedge CEO Roy Kashi believes that this 18% covers costs such as custody, risk of forfeiture, validator fees, and brand premium, estimating the operational cost baseline for the staking ETF to be around 5%. Richard Shorten, founder of GlobalStake, pointed out that there are still many hidden fees before the yield reaches the ETF.
Ethan Buchman, co-founder of Cosmos, stated that 18% is not outrageous for institutional products but expects it to compress to 15% or even 10% in the future. Harriet Browning, Vice President of Sales at Twinstake, warned that excessive fee competition could lead some providers to lower standards in security and transparency. Currently, this commission is still lower than the maximum 25% rate that retail investors pay for directly staking ETH on mainstream crypto platforms. Financial advisor Tyrone Ross questioned whether it is worth ceding 18% of staking yields to BlackRock and Coinbase.
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