Fidelity Outlines Staking Framework for FETH and FSOL
Fidelity's exchange-traded products for Ethereum and Solana—the Fidelity Ethereum Fund (FETH) and Fidelity Solana Fund (FSOL)—have received the authority to stake up to 100% of their cryptocurrency holdings under normal conditions. According to August 21 prospectuses filed by sponsor FD Funds Management, neither fund imposes a minimum staking requirement.
Under the filings, the sponsor retains the flexibility to keep assets unstaked to cover foreseeable redemptions, fund expenses, asset protection, and liquidity programs. The 100% figure represents an authority ceiling rather than a mandate that both funds remain fully staked at all times.
Current Staking Status and Redemption Buffers
Data from the funds show varying degrees of implementation. The FSOL quarterly report indicated that as of June 30, it held 1,687,589 SOL with 1,675,797 staked, achieving a trailing 30-day staked percentage of 99.64% with a fair value of $126.3 million. Meanwhile, FETH reported holding 476,311 ether and $758.609 million in net assets at June 30 without a staked-ether line, though updated trust and custody arrangements in August set expectations for staking to begin as soon as practicable after August 21.
To address redemption challenges, the funds utilize a layered framework. Reserves act as the primary buffer. If reserves fall short and unstaking cannot be completed within the standard settlement window, the sponsor may temporarily extend settlement. In scenarios where an exit remains impracticable within a reasonable extended period, the sponsor may use a discretionary backstop to deliver cash in place of some or all of the crypto owed for in-kind redemptions.
Timing Risks and Fee Structures
Network mechanics create differing timing risks for the two assets. FSOL anticipates regaining complete control of staked SOL within two days under normal conditions without a formal guarantee. Conversely, FETH faces network rules requiring Ethereum validators to leave the active set and clear a mandatory wait before withdrawal sweeps process, a timeline that can be extended by heavy exit demand or network disruptions.
Fidelity outlined several potential future backstops, including credit facilities, direct borrowing of digital assets, validator position sales, and liquid staking structures, though none of the trusts had a line of credit as of August 21. For both products, aggregate staking fees are set at 15% of gross rewards, leaving the remaining 85% to be retained and prioritized for trust expenses, quarterly cash distributions, redemptions, and further staking.
