BlackRock charges an 18% commission on staking rewards for its Ethereum staking ETF; multiple experts assess costs and risks

Gate News update: April 8. BlackRock’s iShares Staked Ethereum Trust (code ETHB) went live on March 12 with a management fee of 0.25% (a temporary discount period of 0.12%). It also charges an 18% commission on the total staking rewards for roughly $318 million worth of staked ETH held in the trust; this commission is split between BlackRock and a certain CEX. Based on the current ETH staking yield of about 2.74%, the 18% commission is roughly equivalent to a total return of 49 basis points. Falconedge CEO Roy Kashi believes that this 18% covers costs such as custody, penalty/seizure risk, validator fees, and brand premium, and estimates that the operational cost floor for a staking ETF is about 5%. GlobalStake founder Richard Shorten noted that there are many hidden fees before the yield reaches the ETF. Cosmos co-founder Ethan Buchman said that 18% is not unusual for institutional products, but expects it to be compressed to 15% and even 10% in the future. Twinstake’s VP of Sales Harriet Browning cautioned that excessive fee competition could lead some providers to lower standards for security and transparency. Currently, this commission is still below the highest 25% fee rate that retail users pay when staking ETH directly on mainstream crypto platforms. Financial advisor Tyrone Ross questioned whether it is worth handing over the 18% of staking rewards to BlackRock and a certain CEX.