Crypto ETF Staking: U.S. Treasury and IRS Approve Rewards

The U.S. Treasury and the Internal Revenue Service (IRS) have released new guidance that changes how crypto ETFs can work, reports Coin Bureau. The new rule allows regulated crypto ETFs to stake their digital assets and share the rewards with investors. This update could make staking, a process once seen as too risky for traditional finance, a part of mainstream investing.

🚨BULLISH: 🇺🇸The U.S. Treasury and IRS just issued a new guidance for crypto ETFs to stake & share rewards with investors. pic.twitter.com/eo54opE0fP

— Coin Bureau (@coinbureau) November 11, 2025

What the New Guidance Means

The announcement comes under Revenue Procedure 2025-31. It gives fund managers a safe path to include staking in their investment products. In simple terms, this means a crypto ETF can now earn staking rewards without breaking U.S. tax rules.

The guidance says that an ETF or investment trust can:

• Hold one type of cryptocurrency (like Ethereum or Solana) for staking.
  
• Keep investor assets with a qualified custodian, who safely holds private keys.
  
• Maintain enough liquidity to handle investor withdrawals, even if some assets are locked in staking.
  
• Distribute staking rewards to investors every quarter, either in cash or in crypto.
  

By following these rules, crypto ETFs can continue to enjoy the same tax benefits as other traditional investment funds.

Why It’s Important

Before this rule, many fund managers avoided staking because it was unclear how it would be taxed. The risk of losing a fund’s tax-friendly status was too high. Now this new framework makes things clearer and safer.

This change could encourage more traditional investors to enter the crypto space. Instead of holding coins directly or setting up complex validator systems, investors can now buy regulated ETF shares that earn staking income for them.

Analysts say this move brings more trust and structure to the crypto market. It also allows proof-of-stake blockchains like Ethereum and Solana to gain more adoption, as more institutional money can now support their networks.

How It Affects You

If you invest in crypto ETFs, this means you could soon earn staking rewards from your holdings. These rewards often range between 4% and 7% yearly, depending on the blockchain. It’s a simple way to gain passive income from crypto without managing wallets or private keys.

For fund managers, the rule opens doors to new products. Moreover, they can design crypto funds that are both compliant and profitable.

Government Support and Investor Caution

This decision shows that the U.S. government is slowly welcoming crypto into its financial system. It sends a message that innovation and regulation can go hand in hand.

However, investors should still be careful. Since staking comes with risks, like network issues or delays in withdrawing assets. It is best to always check how a fund manages these risks before investing.