Demex Daily #113: Fidelity Adds Staking to Ethereum ETF Bid, Faces SEC Scrutiny

What’s Interesting Today:

Fidelity has updated its spot Ethereum ETF application with the U.S. Securities and Exchange Commission (SEC) to include plans for staking part of the fund's Ether through third-party providers. This amendment, which proposes that the fund receive network rewards as income, sets a 90-day window for the SEC to respond, with a decision deadline on May 23. Following the news, tokens of liquid staking providers Lido (LDO) and Rocket Pool (RPL) experienced brief rallies, though they later retraced, suggesting Fidelity might opt for a more centralized staking provider. Fidelity's move aligns with similar February filings from Ark Invest and Franklin Templeton, aiming to offer staking yields. This comes as Ethereum has shifted to a Proof of Stake model since September 2022. However, skepticism remains regarding the SEC's approval of spot Ether ETFs, amid broader concerns from some lawmakers about the risks of crypto-based exchange-traded products to retail investors.


Since February, Fantom has seen significant growth in its FTM token value and Total Value Locked (TVL), with excitement building for the upcoming Sonic upgrade. The price of FTM has increased by 104% in the last 30 days, hitting a 23-month peak, while trading volume soared above 1,000% and TVL in DeFi protocols on Fantom increased by 236%. However, Fantom's TVL is still 98.6% lower than its peak in January 2022. The Sonic upgrade, expected this spring, will bring a new smart contract language and execution engine to the Fantom Virtual Machine, aiming to improve on the Ethereum Virtual Machine (EVM) with enhanced efficiency, compatibility, and reduced costs. Early testing suggests significant improvements, including the ability to support 2,000 transactions per second (TPS) with immediate finality and a substantial reduction in transaction and storage costs, paving the way for new applications in DeFi and web3 gaming.