What does the Hong Kong Securities and Futures Commission launching Ethereum Spot ETF staking services mean for the crypto market?

On April 7, 2025, the Hong Kong Securities and Futures Commission issued a circular regarding virtual asset trading platforms offering staking services. The regulatory body acknowledged the potential benefits of staking in enhancing the security of blockchain networks, as well as the possibility of allowing investors to earn returns.

After the circular was issued, Huaxia Fund and Bosera Fund, which have already issued Ethereum Spot ETFs, responded quickly. On April 11, Bosera Fund announced that its Ethereum ETF was approved to stake up to 30% of its Ethereum holdings starting from April 25. On April 18, Huaxia Fund also announced that it would launch staking services for its Ethereum ETF.

Staking is a feature of PoS public chains. Investors can stake the governance tokens of PoS public chains to nodes or liquidity staking platforms to receive profit distribution. This allows for passive appreciation of the tokens as well as active income.

In contrast, Bitcoin ETFs cannot provide staking services due to the PoW mechanism. The Hong Kong Securities and Futures Commission approved Ethereum ETF staking earlier than the United States, marking a milestone in the development of Web3 in Hong Kong. It demonstrates the regulators' in-depth research on on-chain yield mechanisms and the government's open attitude towards the encryption industry.

1. ETH stake yield analysis

The Ethereum ETF staking nodes of Huaxia and Bosera Funds are provided by OSL and Hashkey exchanges respectively. Since the specific allocation plan has not been announced, the following analysis is based on on-chain data.

1.1 ETH staking mechanism and on-chain returns

Ethereum nodes need to stake 32 ETH to gain the right to confirm transactions. Nodes can earn block rewards, MEV income, and tips. Ordinary holders can indirectly participate in profit distribution through staking service providers.

stake yield = ( block reward + MEV + Tips) / total value of staked Ether

According to the data, in November 2022, the ETH staking APY exceeded 5%, dropping to around 3.3% in December 2024, and reaching 3.07% in May 2025. The yield fluctuations are mainly influenced by MEV and Tips. For example, in May 2023, when the PEPE token trading was booming, the staking APY soared to 10.66%.

Comparison of 1.2 ETH vs SOL stake yield

In May 2025, the staking yield for SOL is 8.70%, far higher than ETH's 3.07%. The staking rate for SOL reaches 67.97%, while ETH is only 28.56%. The EIP-1559 proposal is an important reason for the decline in ETH yields, as it destroys the base Gas fees to achieve deflation. In contrast, Solana retains 50% of the base fees for nodes, achieving a balance between yield and deflation.

Nevertheless, the ETH ETF stake service provides traditional investors with about 3% additional yield without complex on-chain operations, marking an important advance in the transition from Web2 to Web3.

2. The Long-term Impact of Hong Kong ETH ETF Staking Policy

Hong Kong is ahead of the United States in terms of Ethereum ETFs, having approved the establishment in April 2024, with products quickly implemented. However, it still lags behind the United States in scale. By the end of 2024, the largest Ethereum ETF in the United States reached $3.584 billion, while the three ETFs in Hong Kong combined only amount to $63.46 million.

Although the Hong Kong ETF has gained a competitive advantage through staking services, it has not attracted a large inflow of funds in the short term. This may be due to insufficient liquidity in the Hong Kong market, difficulties for international investors in opening accounts, and limited understanding of the "staking" concept among traditional investors.

This policy is a long-term benefit, and its effects may take time to materialize. As market education deepens and infrastructure improves, the long-tail effect of the policy is expected to gradually manifest.

3. The Prospects of the Ethereum Ecosystem and RWA Development in Hong Kong

Hong Kong's choice to launch an Ethereum ETF instead of other public chains is largely due to the advantages Ethereum has in the RWA sector. As of May 2025, the total value of RWA assets on the Ethereum network exceeds 7 billion USD, and stablecoin assets exceed 120 billion USD, both ranking first among public chains.

The Hong Kong Monetary Authority's Ensemble sandbox project launched in 2024 has completed multiple tokenization projects for real-world assets. Huaxia Fund has also launched the first retail tokenized fund in the Asia-Pacific region. These all demonstrate Hong Kong's strategic layout in the RWA field.

Staking services not only enhance returns but also increase Hong Kong's influence in the Ethereum community. Major nodes hold significant discourse power in the governance of the Ethereum ecosystem. By participating in staking, Hong Kong is expected to play a more important role in the Ethereum ecosystem, further promoting the development of RWA.

4. Conclusion

Hong Kong's policy breakthroughs in the Ethereum ecosystem and its layout in RWA have laid the foundation for future development. By approving ETH ETF staking services, Hong Kong has strengthened its position as the Web3 innovation hub in Asia and demonstrated foresight in the RWA field. The Ethereum network has become a bridge connecting traditional finance and the encryption world.

With more RWA projects being implemented, Hong Kong is expected to become a key node for the issuance, trading, and compliance of RWA assets in Asia, promoting the innovative integration of the real economy and blockchain technology. In the future, Hong Kong's influence in the Ethereum ecosystem will further increase, providing stronger support for the development of RWA.