In a surprising move, ARK Invest and 21Shares have revised their proposed spot Ether exchange-traded fund (ETF) application, excluding plans for staking Ethereum. Initially introduced in February, the earlier proposal detailed an arrangement to stake a portion of the fund’s assets. However, the latest submission to the Securities and Exchange Commission (SEC) on May 10 has omitted these details entirely.

The original plan by 21Shares involved earning ETH as staking rewards, classified as fund-generated income. Yet, the updated document not only withdraws this clause but also curtails explanations on potential risks like "slashing penalties" and "temporarily inaccessible funds," which are inherent to staking activities.

This revision may stem from a desire to streamline the application or possibly to reduce the grounds on which the SEC could reject the proposal. According to Bloomberg ETF analyst Eric Balchunas, this could represent either a last-ditch effort to gain approval or a tactical reduction in disclosed information.

ARK and 21Shares first sought approval for their spot Ether ETF in September 2023, aiming to allow investors direct exposure to Ethereum through trading on the Cboe BZX Exchange. Notably, the fund would track the CME CF Ether-Dollar Reference Rate – New York Variant.

The SEC has recently shown a cautious stance on cryptocurrency ETFs, having delayed decisions on similar applications from leading firms like Invesco, Grayscale, and BlackRock. Currently, the agency is set to decide on VanEck's Ethereum ETF proposal by May 23, followed closely by ARK and 21Shares's application on May 24.

Despite the SEC's approval of spot Bitcoin ETFs earlier in January, the sentiment for Ethereum ETFs has cooled significantly, with expectations for approval plummeting from a hopeful 70% to a mere 25% by late May, as per Balchunas's assessments. This latest filing adjustment by ARK and 21Shares adds another layer of intrigue to the evolving narrative of cryptocurrency investments on Wall Street.