Fidelity Files to Stake Up to 100% of Ethereum ETF Holdings With 15% Aggregate Fees

ETH-2.50%
According to SEC filings surfaced in early August, Fidelity Investments filed a Form S-3 registration statement on July 24, 2026, to convert its spot Ethereum ETF (FETH) from a passive price tracker into a product earning staking income. The proposal permits FETH to stake up to 100% of its ether holdings under normal circumstances, with aggregate staking fees set at 15% of all rewards received, shared among sponsor, custodians, and node operators. The remaining 85% of rewards would be retained by the trust, potentially distributed quarterly to shareholders. FETH held approximately $898 million in net assets as of mid-August 2026. The structural shift would allow FETH to track Ethereum price returns plus staking rewards minus combined expenses. Ethereum's network-wide staking ratio stood at approximately 34% as of mid-August, with roughly 41.4 million ETH locked in validators, according to KuCoin data. Fidelity faces liquidity management challenges, as unstaking can take hours to months depending on network congestion; the fund may extend redemption settlement periods or use cash settlements when needed.
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