CoinShares Launches Polkadot and Tezos ETPs with Staking Rewards

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The digital asset investment landscape is evolving, and CoinShares is at the forefront with its latest innovation: physically backed exchange-traded products (ETPs) for Polkadot (DOT) and Tezos (XTZ) that pass staking rewards directly to investors. This strategic move marks a significant step in making proof-of-stake (PoS) assets more accessible to traditional and retail investors through regulated financial instruments.

Introducing Staked ETPs: A New Era for Passive Crypto Income

CoinShares has launched the Physical Staked Polkadot ETP and Physical Staked Tezos ETP, now available on Germany’s Xetra exchange. These products are designed to offer investors exposure to two major proof-of-stake blockchains while enabling them to earn staking yields—approximately 5% annually for Polkadot and 3% for Tezos—without managing private keys or running validator nodes.

Unlike traditional ETPs where management fees gradually reduce investor entitlement, these new products reverse the trend. According to Townsend Lansing, CoinShares’ Head of Product, the coin entitlement increases over time as staking rewards are accrued daily. To facilitate this, CoinShares has reduced the management fee from 1.5% to 0%, effectively passing the full annualized staking yield to shareholders.

👉 Discover how staking-powered ETPs are reshaping passive income in crypto.

How Do These ETPs Work?

Physically backed ETPs hold actual cryptocurrency reserves rather than derivatives or synthetic exposures. In this case, both the Polkadot and Tezos ETPs are 100% physically backed and custodied by Komainu, a regulated digital asset custodian. The staked assets remain securely locked and do not move during the staking process, ensuring safety and transparency.

Investors can redeem their ETP shares directly for the underlying native assets—DOT or tez—at any time, adding a layer of flexibility uncommon in many staking solutions. This feature combines the liquidity of exchange-traded products with the long-term value accrual of staking, making it ideal for both conservative and growth-oriented investors.

Expanding Beyond Bitcoin and Ether

While Bitcoin (BTC) and Ether (ETH) continue to dominate institutional interest, alternative cryptocurrencies are gaining traction among self-directed investors. CoinShares executives noted last month that retail demand is increasingly extending beyond the top two digital assets.

This shift in investor behavior has prompted CoinShares to diversify its ETP offerings. The Polkadot and Tezos products join an existing suite of physically backed ETPs that include:

Launched in January, this lineup now represents a comprehensive suite of regulated crypto investment vehicles across major blockchains—both proof-of-work and proof-of-stake.

With approximately **$475 million in combined assets under management**, CoinShares’ ETP range continues to attract steady interest despite market volatility. Notably, the firm reported $14 million in inflows during a recent week of price weakness, breaking a five-week streak of outflows—a sign that investors may be viewing current market conditions as a strategic entry point.

Why Staking Rewards Matter in Crypto Investing

Staking has become a cornerstone of proof-of-stake ecosystems. By locking up coins to support network security and transaction validation, participants earn rewards—similar to interest in traditional finance. However, direct staking often involves technical complexity, lock-up periods, and security risks.

CoinShares’ staked ETPs eliminate these barriers. Investors gain exposure to staking yields through a familiar, exchange-traded format with daily pricing, liquidity, and no need for technical know-how.

Frank Spiteri, CoinShares’ Chief Revenue Officer, emphasized the broader implications:

“We are excited to push the industry forward again with these staked ETP launches. We believe that over time this will become investors’ preferred structure for ETPs tracking digital assets based on proof-of-stake blockchains.”

This sentiment reflects a growing trend: institutional-grade infrastructure that simplifies access to decentralized finance (DeFi) benefits without compromising on security or compliance.

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👉 Learn how you can earn yield on proof-of-stake assets without the hassle.

Frequently Asked Questions (FAQ)

Q: What are physically backed crypto ETPs?
A: Physically backed ETPs hold actual cryptocurrency reserves rather than using derivatives. This ensures direct exposure to price movements and eliminates counterparty risk associated with synthetic products.

Q: How do investors earn staking rewards through these ETPs?
A: Instead of charging a management fee, CoinShares reduces it to 0% and increases the coin entitlement daily based on accrued staking rewards—effectively passing 3% (Tezos) or 5% (Polkadot) annual yields to shareholders.

Q: Can I redeem my ETP shares for actual DOT or XTZ?
A: Yes. Investors have the option to redeem shares directly for the underlying native assets—DOT or tez—providing flexibility and direct ownership when desired.

Q: Are the staked assets secure?
A: Yes. All assets are held in custody by Komainu, a regulated custodian, and remain 100% physically backed at all times. The staked coins do not move from cold storage during validation.

Q: Where are these ETPs listed?
A: The Physical Staked Polkadot and Tezos ETPs are currently listed on Xetra, one of Germany’s largest electronic trading platforms, offering high liquidity and regulatory oversight.

Q: Why choose an ETP over direct staking?
A: ETPs offer simplicity, liquidity, and regulatory compliance. They allow investors to earn staking-like returns without managing wallets, dealing with lock-ups, or facing technical hurdles.

👉 Start earning yield on your digital assets today—explore seamless investment options.

The Future of Regulated Crypto Investment Products

CoinShares has been a pioneer in bringing crypto to mainstream finance. Its Physical Bitcoin ETP, launched in 2015, was the first of its kind in Europe. Now, with staked ETPs for Polkadot and Tezos, the firm is setting a new standard for how investors access yield-generating digital assets.

As demand grows for regulated, transparent, and user-friendly crypto products, innovations like staked ETPs bridge the gap between decentralized networks and traditional capital markets. They offer a compelling solution for those seeking passive crypto income, long-term exposure, and institutional-grade security—all within a single, tradable instrument.

For investors looking to diversify beyond BTC and ETH while benefiting from staking economics, CoinShares’ latest offerings represent a timely and powerful advancement in digital asset investing.