To facilitate this product, which provides a regulated and secure option for retail and institutional investors, 3iQ has entered into a strategic collaboration with Coinbase Custody Trust Company. The staking feature is expected to be available on or around August 28.
Coinbase will provide the necessary infrastructure, allowing investors to participate in the staking process. By offering this yield-earning program, 3iQ aims to provide an additional benefit to its fund holders and attract investors looking to earn passive income from their ether investments.
The announcement had a positive impact on the involved entities, as Coinbase Global Inc’s shares (NASDAQ: COIN) closed trading on Thursday with a 2.3 percent increase, reaching $72.43. Additionally, the 3iQ Ether ETF experienced a 1.45 percent surge and closed the day trading around $9.79.
Coinbase’s alliance with the Toronto-based digital asset manager comes as the US popular exchange aims to strengthen its presence in Canada amidst regulatory uncertainty in the United States.
“While staying true to the investment objectives of the Funds, we believe that commencing ETH staking offers the best of both worlds to our investors – providing additional yield while eliminating the complexities of directly handling digital assets,” Fred Pye, Chairman and CEO of 3iQ, said in a statement.
Once the ether staking feature is implemented, 3iQ’s Ether Fund and Ether ETF holders will be able to participate in a regulated yield-earning program. By staking their ether holdings, investors can earn rewards in the form of additional ETH, which will then be reflected in their fund’s net asset value (NAV).
3iQ already manages private investment funds, which started as a private placement available only to accredited and institutional investors in Canada. Its exchange-traded products provide stockholders with direct exposure to bitcoin value. The non-redeemable investment fund further aims to achieve capital appreciation through a long-term holding strategy.
To lend support to the fund, 3iQ addressed the questions of pricing, custody, audit, and public interest issues in a regulated investment fund. It acts as the investment and portfolio manager of the fund, while New York-based crypto exchange, Gemini Trust fulfils the functions of the custodian of the bitcoins held in the fund.
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