Grayscale Ethereum Staking ETF Distributes First Rewards as Investor Confidence Rebounds. Source: EconoTimes

Grayscale has officially released the first round of staking rewards from its Ethereum Staking ETF, marking a major milestone for regulated crypto investment products. The distribution reflects rewards accrued between early October and the end of December, with shareholders receiving a cash payout of 0.083178 per share. Investors recorded as of January 5 are set to receive payments on January 6, reinforcing the ETF’s role in translating blockchain staking yields into traditional investment returns.

This development coincides with renewed inflows into U.S. Ethereum spot ETFs, suggesting improving market sentiment following recent volatility. After weeks of heavy outflows and price corrections, data indicates that investors are cautiously returning, viewing lower prices as strategic accumulation opportunities. According to SoSoValue, weekly net inflows have turned positive, pushing total Ethereum ETF assets close to $19 billion.

Grayscale introduced staking to its Ethereum products in late 2025, positioning itself among the first asset managers to integrate network participation rewards into an ETF structure. The fund was renamed to reflect its expanded functionality, particularly its staking component, which allows investors to benefit from Ethereum’s proof-of-stake mechanism without directly managing validators or crypto wallets. Grayscale has emphasized that its staking model operates within defined liquidity and security limits, underscoring the importance of investor education before participation.

Despite the recent recovery, Ethereum ETFs are still rebounding from significant outflows earlier in the quarter. Bloomberg Intelligence analyst James Seyffart noted that nearly $2.8 billion has exited U.S. Ethereum funds since their peak inflows of approximately $15 billion in early October. This represents roughly 18% of cumulative flows leaving the market. Assets under management have declined from over $32 billion at the start of October, largely due to ETH price depreciation.

However, institutional behavior points to growing confidence. Large Ethereum whale purchases and continued accumulation by firms such as Bitmine indicate long-term bullish positioning. Combined with BlackRock’s recent crypto asset movements, these trends highlight ongoing capital rotation rather than an exit from the sector.

Overall, the successful distribution of staking rewards strengthens the case for Ethereum ETFs as mainstream investment vehicles, bridging decentralized finance mechanisms with regulated markets and potentially boosting investor confidence in the evolving crypto ETF landscape.