According to a report by The Block, S&P Global Ratings, an international credit rating agency, has analyzed that the approval of proposed US Ether spot ETF with staking operations could increase the concentration risk of Ethereum.
In a report released on Tuesday (19th), S&P analysts Andrew O’Neill and Alexandre Birry stated:
Analysts predict that the US Securities and Exchange Commission (SEC) could approve the Ether spot ETF as early as May this year, which is the first deadline for approving such funds. Several companies, including BlackRock and Fidelity, have applied for Ether spot ETFs. Some of these applicants, especially Ark Invest and Franklin Templeton, are also seeking additional yield through staking the underlying asset, Ether.
According to Dune data, Lido, a decentralized liquidity staking protocol, is currently the largest Ethereum staking platform, followed by the cryptocurrency exchange Coinbase. According to S&P analysts, the staking for Ether spot ETFs is unlikely to choose decentralized protocols like Lido. Instead, they may opt for institutional-grade cryptocurrency custodians. The analysts noted that the impact on concentration will depend on whether the issuers diversify their staked ETH across multiple custodians.
Related report: “SEC delays Invesco Ether spot ETF application again; Analysts: Not surprising, May is the key!”
