U.S. Clears Way for Crypto ETPs to Get Into Yield Without Triggering Tax Problems

Why It Matters

By clarifying the tax treatment of staking, the guidance paves the way for a new source of yield in regulated crypto funds, expanding product offerings and attracting more capital to the sector. It also strengthens the United States’ competitive position in the global crypto market.

Summary

The U.S. Internal Revenue Service issued a safe‑harbor guidance that allows crypto exchange‑traded products (ETPs) to stake proof‑of‑stake assets without losing their tax‑exempt trust status, effective immediately. The rule removes a key legal obstacle for fund sponsors, custodians and asset managers, enabling them to pass staking rewards on to retail investors. Treasury Secretary Scott Bessent highlighted the move as a boost to investor benefits, innovation and U.S. leadership in digital assets, while industry counsel Bill Hughes expects higher staking participation, liquidity and network decentralization.