Grayscale plans to introduce regular cash distributions from the large rewards received by its Ethereum and Solana exchange-traded funds.
Summary
- Grayscale organizes quarterly cash distributions on the largest rewards earned on its Ethereum and Solana exchange-traded funds.
- ETHE and GSOL fees will vary depending on awards, operating costs, fees and tax treatment.
- ETHE previously distributed $9.39 million after converting accumulated Ethereum rewards into cash payments to shareholders.
The asset manager disclosed the proposed changes in separate filings dated July 17 for the Grayscale Ethereum Staking ETF, or ETHE, and the Grayscale Solana Staking ETF, or GSOL.
Under the proposed trust amendments, each fund will sell the ETH or SOL received from the staking and distribute the net proceeds to shareholders. Grayscale will complete that process in less than a quarter.
The company expects to make the amendments “on or about August 7, 2026,” according to the filing. However, the notices do not set a fixed payment date or a guaranteed distribution amount.
ETHE and GSOL will convert huge rewards into cash
The proposed plan would require both trusts to convert the staking consideration into cash at least once a quarter. They will then pay shareholders after deducting non-Greyscale costs.
Those deductions may include a portion of the stake rewards paid to Grayscale for organizing and managing the holding process. The final amount will depend on the awards received by each trust over the relevant period.
Greyscale said distribution rates “cannot be predicted with certainty.” The maximum rewards for Ethereum and Solana are subject to change due to network conditions, validator performance and the amount of assets staked.
Trusts may also make payments more frequently than quarterly. The proposed agreements set a minimum frequency rather than a fixed calendar or annual yield.
As a result, investors can compare the earnings of ETHE and GSOL for the same reporting periods. However, funds would not promise the same yield or equal distribution.
ETHE previously paid $9.39 million to shareholders
The proposed structure follows the previous distribution of funds from ETHE. In January 2026, the fund converted Ethereum stake awards received between Oct. 6 and Dec. 31, 2025, became money.
ETHE paid shareholders about $0.083178 per share, with a total distribution of about $9.39 million. The payment showed how large rewards can go through a listed Ethereum product without directly distributing ETH.
ETHE became the first US-listed cryptocurrency exchange to transfer Ethereum directly to investors for a cash payment.
Grayscale added focus to its Ethereum and Solana products in October 2025. The company said the structure will give shareholders exposure to digital underlying assets while allowing trusts to earn network rewards.
Crypto.news reported at the time that ETHE, Ethereum Mini Trust ETF and GSOL would add capabilities.
Meanwhile, GSOL began trading on NYSE Arca in October 2025 after operating as a closed trust. Grayscale originally planned to transfer 77% of Solana’s net awards to the fund’s net asset value.
As previously reported, the product launched with more than 102 million dollars in assets and accounted for 75% of its SOL assets.
IRS rules shape the proposed distribution plan
Greyscale said the proposed amendments will help ETHE and GSOL comply with IRS Revenue Procedure 2025-31. The guidance outlines the circumstances under which certain trusts can own digital assets while maintaining grantor trust status for US federal tax purposes.
The process allows the eligible trust to distribute the total stake rewards either in digital assets or in cash after the sale. It also requires constant distribution less than quarterly.
Grayscale chose the cash option for both currencies. Therefore, ETHE will sell ETH rewards, while GSOL will sell SOL rewards before distributing the remaining funds.
The SEC disclosure also cautions that receiving cash does not determine when a shareholder records taxable income. Under the proposed grantor trust treatment, US investors could see their share of the valuable rewards when the trust receives them.
That tax event may occur before the investor receives a subsequent distribution. In addition, selling ETH or SOL to finance the payment can create a large profit or loss shared by shareholders.
Greyscale advised investors to consult their tax advisors regarding their individual circumstances. The company did not provide an estimated yield for any product.
Quarterly payments can make fund returns easier to compare
A regular payout schedule will give ETHE and GSOL investors a clear record of how much each fund is generating in terms of earnings after fees and expenses.
Investors can compare distribution rates, settlement times and deductibles across all Ethereum and Solana products. However, the results will depend on the economic holdings of each network and the amount of assets that the trusts and guarantors place in them.
Some fund managers have also moved into staking-based crypto products. BlackRock’s Ethereum product is expected to distribute rewards monthly or at least quarterly.
Institutional interest in managed equity exposure has also grown. As crypto.news reported in May, Dartmouth disclosed holdings in both the Solana staking ETF and Greyscale’s Ethereum product.
Grayscale still has to complete the dependency changes before the resulting framework takes effect. When implemented around August 7, the changes will establish smaller quarterly distribution schedules for both ETHE and GSOL.
Initial payment dates and amounts remain unknown. It will depend on prize money, fund costs, sales of ETH or SOL and tax rules applied during each distribution period.
