Crypto exchange-traded fund (ETF) issuers are likely to partner with centralized staking providers following approval, but will eventually pivot to decentralized protocols as regulatory frameworks mature.
In a note, he said:
“DeFi partnerships are still possible, but probably through intermediaries that handle the regulatory layer while routing funds into protocols.”
However, Shannon anticipates a gradual shift toward hybrid or direct DeFi integrations as regulatory environments mature.
Powell assessed via a note:
“The regulatory clarity creates a clear path that benefits the ecosystem across CeFi and DeFi: institutional capital flows to trusted custodians who then safely allocate into high-performing staking infrastructure.”
Misha Putiatin, co-founder of Symbiotic, views the distinction between centralized and decentralized as less critical than revenue diversification opportunities.
According to a note shared by Putiatin:
“The key is that each asset can now generate multiple revenue streams, and ETFs will diversify their offerings around these.”
He cited strong decentralized options that already compete effectively in compliance, traditional finance integration, and performance metrics.
Powell expects institutional validation to transform liquid staking protocols from experimental DeFi infrastructure into core financial architecture:
“ETF and DAT [digital asset treasuries] structures will channel billions through qualified custodians into liquid staking protocols, potentially increasing current AUM by orders of magnitude.”
Yet, Shannon warns that concentration risk could emerge if flows concentrate in one or two protocols, potentially attracting closer regulatory oversight.
Nevertheless, he expects even small ETF allocations could massively boost total value locked, strengthening liquidity and utility of liquid staking tokens.
Lastly, Putiatin believes that the interaction between ETF issuers and DeFi protocols could reshape yield structures. He noted that this movement opens the door to more active strategies that demand crypto native expertise far beyond traditional capital allocation.
The regulatory clarity is positioning staking ETFs as a vehicle to capture institutional capital that has waited on the sidelines while preserving compliance requirements through established custodial relationships.
