BlackRock and Coinbase plan to keep 18% of the staking rewards generated by BlackRock’s proposed Ethereum staking ETF, according to an amended filing with the U.S. Securities and Exchange Commission. Under the structure described in the document, investors would receive 82% of gross staking rewards, while the fund sponsor and execution partner would take the remaining share. The updated S-1 was filed on Feb. 17.
Shareholders would also pay an annual sponsor fee ranging from 0.12% to 0.25% of the investment value. That charge sits on top of the staking split, which means investor returns would come in below the headline yield produced onchain.
Most of the fund’s ETH would be staked
The filing says the ETF would put most of its Ethereum holdings to work in staking. Under normal conditions, between 70% and 95% of fund assets could be staked, with the remainder held back for liquidity needs and redemptions. That makes the product more than a simple spot vehicle, as staking income is built into the proposed ETF structure.
Coinbase would serve as custodian and prime execution agent through its institutional services unit. The company may also pass along part of its share to third-party validators and infrastructure providers involved in the staking process.
Seed capital and projected yield
BlackRock has already seeded the trust with $100,000, equal to 4,000 shares priced at $25 each. The filing also indicates the firm is building its Ethereum position ahead of a possible launch.
Based on network data from early 2026, Ethereum staking yields have averaged close to 3% annually. After the 18% revenue split and the additional fund fees, the effective return to investors is expected to be lower, depending on market conditions and overall staking participation.
Support for regulated yield products meets fee and centralization criticism
The proposed fund is described as a yield-generating version of BlackRock’s existing spot Ethereum ETF. After the success of its Bitcoin and Ethereum offerings, BlackRock has become a major force in digital asset ETFs over the past two years. Nasdaq has already applied to list the staked product, pointing to rising interest in regulated crypto yield exposure inside traditional markets.
Supporters say the structure could attract investors who want blockchain-based rewards without handling wallets or running validators themselves. Critics are focused on two issues: whether an 18% share of staking income is too expensive, and whether products like this could push more influence toward large financial firms.
During the same week as BlackRock’s filing, Vitalik Buterin warned that increasing Wall Street participation in Ethereum could raise centralization risks over time. That has kept the debate around the proposed ETF centered not just on fees, but also on control.