Staking ETPs Gain Traction in Europe as 21Shares Launches Injective Product
- PHPzOriginal
- 2024-07-19 14:59:58321browse
21Shares has launched an Injective exchange-traded product (ETP) on Euronext exchanges. Injective thus joins a small group of cryptos available to investors through traditional financial products.
Cryptocurrency Injective (INJ) has joined the ranks of digital assets available to investors through traditional financial products with the launch of an Injective exchange-traded product (ETP) by asset manager 21Shares on Euronext exchanges.
The Injective Staking Exchange Traded Product (AINJ) will track the performance of Injective (INJ) and capture staking yield for reinvestment in the ETP. Injective is a decentralized blockchain designed for financial applications.
The ETP will be physically backed by INJ and will trade on the Euronext Paris and Euronext Amsterdam exchanges with the support of 25 financial institutions. Among them are Interactive Brokers, Saxo Bank, Swissquote and eToro.
AINJ has $128.6 million in assets under management and charges a fee of 2.5%. Securities listed on Euronext markets are regulated under the single Euronext Rule Book, which harmonizes all applicable regulations where it operates.
The launch of the Injective staking ETP follows a growing demand for instruments that combine the benefits of traditional finance and digital assets. Injective uses a proof-of-stake consensus mechanism, which allows AINJ to stake INJ to secure the network and receive rewards for it. 21Shares stakes only a portion of the assets underlying its ETPs to guarantee liquidity for investor redemptions, the firm stated in a report last year.
Coinbase data shows that INJ is paying an estimated 19.38% staking reward at the time of writing, and the rate is decreasing. INJ has a market capitalization of $2.4 billion.
A variety of staking ETPs are available in Europe. 21Shares launched an Ethereum staking ETP in 2019. It launched the Staking Basket Index ETP (STAKE) with seven underlying coins last year. CoinShares began offering eight ETPs with staking in Germany last year.
In the United States, Fidelity proposed a similarly structured Ethereum fund, but later amended its S-1 application to the Securities and Exchange Commission to remove the staking feature. Grayscale introduced the Grayscale Dynamic Income Fund for qualified U.S. investors in March. Grayscale stated that the fund will prioritize staking income over capital growth.
Injective debuted on the Cosmos ecosystem in 2021 with backing from Binance and investor Mark Cuban. It integrated with the Ethereum and Solana chains in 2022. In an overview published on July 4, 21Shares noted that the chain has only 60 validators and:
“It has competitive advantages in its open liquidity pool and real-world asset module,” the report added.
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