VanEck Europe Authorizes Staking of Its $73 Million Solana ETN

VanEck has introduced staking of its Solana Exchange Traded Note (ETN) in Europe, which currently has assets under management (AUM) totaling $73 million.

The Solana ETN, which trades under the symbol VSOL, will now allow investors to benefit from staking rewards that will be accrued and reinvested daily.

A non-custodial staking model

The announcement was made by Mathew Siegel, VanEck’s head of digital assets research, in an October 21 article on ‘ETN, thus ensuring that investors can maintain daily liquidity.

An accompanying document reveals that the staking process for the Solana ETN is entirely non-custodial. This means that the asset owner maintains full control over the SOL tokens staked throughout the process.

This strategy aims to mitigate risk by not exposing assets to lending practices commonly associated with traditional staking methods.

According to the company’s marketing communications, investors are not required to take any action in the staking process, and any rewards they earn are automatically included in the ETN’s tokenized equity.

Rewards will also be split equally among investors, whether they recently purchased the ETN or have held it for a longer period of time. However, VanEck will deduct a staking fee of 25% from the accumulated rewards before distribution.

How Staking Works for the Solana ETN

The staking process begins with the delegation of Solana tokens held by the ETN. Managed by an external staking provider, the validator earns inflationary rewards, maximum extractable value (MEV) rewards, and epoch-by-epoch block rewards. However, control of the delegated SOL remains in the hands of the custodian while the assets are never removed from the cold storage.

Once rewards are accumulated, they are reinvested daily into the ETN and reflected in its overall performance. Depending on market and network conditions, VanEck says it can adjust the scale of staking activity to ensure it remains fully liquid and redeemable at any time.

Meanwhile, the asset manager remains committed to launching a Solana exchange-traded fund (ETF) in the United States despite the regulatory landscape. Siegel previously said the company would work with its exchange partners to defend its position on the offering to relevant regulators.