VanEck Introduces Staking for Solana ETN in Europe
VanEck has officially introduced staking for its Solana exchange-traded note (ETN), named VSOL, in the European market.
Details of the Staking Option
On October 21, Matthew Sigel, the head of digital asset research at VanEck, confirmed the launch, highlighting that this new feature enables investors to earn rewards, which will be directly reflected in the daily net asset value (NAV) of the ETN.
How the Rewards Work
Investors in VSOL can look forward to receiving 75% of the gross staking rewards, with a 25% deduction applied as VanEck’s staking fee. This feature of generating passive income is accessible to all VSOL holders, irrespective of when they invested, with no further action required on their part.
Overview of the VSOL ETN
VSOL is a cryptocurrency ETN designed for European investors, established in Liechtenstein. It was launched on Deutsche Börse, one of Europe’s leading stock exchanges, back in September 2021.
As of October 18, the ETN’s total assets under management (AUM) amount to $73.8 million. According to information available on VanEck’s website, the shares are trading at approximately €8.229 ($8.93), with the current NAV registered at $8.21.
Non-Custodial Staking Approach
VanEck has emphasized a fully non-custodial approach to staking, ensuring that the custodian of the ETN maintains full control over staked assets. This structure mitigates lending risks that could otherwise affect investors.
How Staking is Managed
According to Sigel, client funds will be delegated to validator nodes managed by a third-party provider, with the SOL tokens held by the ETN being staked in this manner. The custodian continues to manage the assets in cold storage.
“In the realm of regulated traditional finance, asset managers cannot directly hold customer funds, necessitating third-party segregation to safeguard client assets. Staking customer funds on infrastructure owned by the asset manager poses similar challenges.” – Matthew Sigel
Future Developments on the Horizon
Additionally, Sigel hinted at exciting potential advancements, including the exploration of liquid staking tokens (LSTs) such as jitoSOL. Currently, VanEck employs an internal dynamic risk model to ensure sufficient liquidity for daily redemptions.
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