tl;dr
**21Shares Eyes Big Move with SEI ETF as Staking Debate Heats Up**
The crypto world is buzzing as 21Shares, a Swiss-based investment firm, takes a bold step toward bridging the gap between traditional finance and digital assets. The company has filed an S-1 registration with the U.S. Securities a...
**21Shares Eyes Big Move with SEI ETF as Staking Debate Heats Up**
The crypto world is buzzing as 21Shares, a Swiss-based investment firm, takes a bold step toward bridging the gap between traditional finance and digital assets. The company has filed an S-1 registration with the U.S. Securities and Exchange Commission (SEC) to launch the 21Shares SEI ETF, a passive fund designed to track the CF SEI-Dollar Reference Rate. If approved, the ETF could mark a pivotal moment for the Sei (SEI) blockchain, potentially offering investors exposure to staking rewards—a feature that has sparked both excitement and regulatory scrutiny.
### **Staking Rewards: A Double-Edged Sword**
The ETF’s unique angle lies in its potential to reflect staking rewards from a portion of SEI tokens. According to the SEC filing, the fund would avoid leverage and derivatives, relying instead on a cash-or-in-kind creation/redemption mechanism. Coinbase Custody, a trusted name in crypto custody, has been appointed as the SEI custodian. However, the inclusion of staking rewards is conditional. The fund’s sponsor must navigate a labyrinth of legal and tax risks, including the use of liquid staking tokens (LSTs) to preserve the fund’s grantor trust status.
This isn’t the first time staking has been in the spotlight. The SEC has repeatedly delayed decisions on staking features for Grayscale’s spot ETH funds, with a final deadline looming in October 2025. Analysts warn that any altcoin ETF aiming to integrate staking yields will face similar hurdles. While 21Shares has included the staking option in its proposal, the chances of it being implemented at launch remain slim unless the SEC provides clearer guidance.
### **SEI’s Price Surges on Speculation**
Despite the regulatory uncertainty, SEI’s price has already reacted positively. At the time of writing, SEI trades near $0.30, up 3.33% for the day, with a market cap of $1.82 billion and a 24-hour trading volume exceeding $210 million. The token’s performance has caught the attention of institutional investors, who may view the ETF as a gateway to capitalize on SEI’s growing ecosystem.
Technical analysts on X (formerly Twitter) are optimistic. SEI has rebounded from a critical support level, aligning with the lower boundary of a “bullish pennant” pattern. If the price breaks above the triangle’s upper trendline, targets could rise to $0.345, with more ambitious forecasts eyeing $0.60. Michaël van de Poppe, a well-known crypto analyst, noted, “SEI bounced back from a crucial support level and is likely to close a strong week.”
Yet, not all signals are bullish. Some observers caution that SEI is consolidating above the $0.29 zone, a scenario that could lead to volatility before a clear direction emerges. They advise investors to focus on risk management and set invalidation levels rather than chase headlines.
### **A Broader Regulatory Chessboard**
The SEI ETF isn’t the only play in this arena. Earlier this year, CBOE filed the Canary Staked SEI ETF 19b-4 with the SEC, signaling growing interest in staking-focused products. Meanwhile, 21Shares’ XRP ETF filing was delayed, despite rising optimism around regulatory developments. These moves highlight the SEC’s cautious approach to crypto innovation, even as market enthusiasm for tokenized assets continues to grow.
For now, the SEI ETF remains a work in progress—a tantalizing possibility that could reshape how investors interact with blockchain ecosystems. Whether it becomes a reality depends on the SEC’s next move, a decision that could ripple across the crypto and traditional finance worlds alike.
As the clock ticks toward potential approvals, one thing is clear: the line between speculation and regulation is getting thinner, and the stakes have never been higher.