VanEck, a prominent asset management firm, has announced that its Solana exchange-traded note (ETN) has successfully enabled the staking function in the European market. This marks a significant milestone for the ETN, which now offers investors the opportunity to earn staking rewards alongside exposure to Solana’s price.
Solana Staking Rewards Will Be Reflected in Users’ Accounts on the Same Day
The Solana ETN, incorporated in Liechtenstein, has an asset management scale (AUM) of $73 million. Staking rewards will be automatically included in the token equity of the ETN, reflecting in the daily terminal value.
Mathew Sigel, head of digital asset research at VanEck, explained that the staking rewards will accrue and be reinvested daily. VanEck will manage the staking exposure to ensure daily liquidity, using an in-house dynamic risk model to meet redemption requirements.
Sigel highlighted that the shorter epochs of Solana make it easier to manage staking compared to Ethereum, where VanEck has been offering staking for a longer period. He also noted that European regulations are less strict than US regulations on this specific point.
In response to a question about whether VanEck runs its own node, Sigel explained that due to regulatory requirements, asset managers cannot hold customer funds directly. Staking customer funds to asset-manager-owned infrastructure raises similar concerns.
VanEck utilizes the physical Solana held by the ETN for staking by instructing the custodian to delegate the Solana to a validator. The validator node is managed by a staking provider, while the control of the delegated Solana remains with the custodian in cold storage.
