VanEck has introduced staking for its Solana exchange-traded note (ETN) VSOL in the European market.
Matthew Sigel, head of digital asset research at VanEck, announced the launch on Oct. 21. This new staking feature enables investors to earn rewards, impacting the daily net asset value (NAV) of the ETN.
The rewards earned will automatically be added to the VSOL token’s equity and included in its daily terminal value. Investors will receive 75% of the gross staking rewards, with a 25% deduction for VanEck’s staking fee. This passive income opportunity is accessible to all VSOL holders, requiring no additional action from investors.
VSOL is a crypto ETN designed for European investors and was established in Liechtenstein. It was listed on Deutsche Börse in September 2021, one of Europe’s top stock exchanges.
As of Oct. 18, the ETN’s assets under management (AUM) amount to $73.8 million. The shares are priced around €8.229 ($8.93), with the NAV at $8.21, according to VanEck’s website.
Non-custodial Staking Approach
VanEck stresses that its staking process is fully non-custodial, ensuring the custodian maintains control over the staked assets to mitigate lending risks that could impact investors.
Sigel explained that client funds are delegated to validator nodes managed by a third-party provider. The SOL tokens, staked by the ETN, are managed by the custodian in cold storage.
He stated:
“In regulated TradFi, asset managers cannot hold customer funds directly. Staking customer funds to asset-manager-owned infrastructure raises concerns about client asset protection.”
Sigel mentioned potential future developments, hinting at using liquid staking tokens (LSTs) like jitoSOL. Currently, the firm relies on an internal dynamic risk model to ensure liquidity for daily redemptions.
