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VanEck has introduced another feature amid the heightened demand for Solana. According to the official announcement, the staking capability has been effectively enabled by VanEck with its Solana exchange-traded note (ETN) in the European market.
The asset management company has ETN nearly worth $73 million AUM, under its belt. The token ownership of ETN will automatically include staking rewards, which will be reflected in the daily terminal value.
The news comes in parallel with Solana prices being sky-high. At the press time, the coin is trading at $163.93, up nearly 3.13% as compared to the same time last day. Earlier in the trading day, the coin was up as much as 4%, according to data from CoinMarketCap.
The process of staking cryptocurrency involves placing one’s coins on a blockchain to validate transactions and gain rewards for specific blocks.
How Will The Staking Work?
VanEck plans to introduce the staking system in which the Custodian of the ETN’s assets maintains complete control over the staked assets. This will enable the custodian to eliminate lending risk.
If incentives are paid out, they will be taken into account in the ETN’s coin entitlement, therefore investors in the Solana ETN do not need to take any action. It makes no difference if one has purchased the ETN last week or last year; the entire amount of staking rewards earned over that period will be dispersed evenly (without the 25% staking fee).
Additionally, VanEck will instruct the custodian to assign SOL to a validator in order to stake using the Physical SOL that is stored by the ETN.
The custodian retains ownership and management of the delegated SOL, whereas the staking provider owns and maintains the validator node.
Staking rewards are contingent upon several uncontrollable circumstances, such as the quantity of validators on the network and the level of demand for Solana transactions. For Solana, the annual staking yield typically ranges from 7 to 9%.
Will SOL Prices Keep Trading Higher In The Future?
Solana price momentum has been trading green for the past month. Being up over 10% in the last 30 trading days, a heightened demand for SOL has resulted in investors being upbeat about the coin.
In the coming month, given that this momentum continues, Solana is expected to increase by 13.60%. SOL’s technical indicators reveal that the mood for the coin is bullish right now, and the Fear & Greed Index is 72 (Greed).
Over the previous 30 days, Solana has had 15/30 (or 50%) green days and 4.01% price volatility. Market parameters show that overall SOL has 28 technical analysis indicators indicating bullish signs and 3 indicating bearish indications.