To The Moon

According to Woofun AI, the staking plans for Fidelity's FETH (FETH.US) and FSOL grant its Ethereum and Solana-based exchange-traded products the authority to stake 100% of held cryptocurrencies. However, this high-yield strategy directly introduces significant exit delay risks.

To address redemption pressure caused by lengthy network exit processes, the plan incorporates a multi-layered buffer mechanism. First, reserve funds are utilized as a liquidity buffer; if reserves are insufficient and unstaking cannot be completed within the standard settlement period, the sponsor may extend the settlement timeline; even if exit remains unachievable after reasonable extensions, cash payments are adopted to replace part or all of the cryptocurrencies owed. Notably, these measures are defined as optional choices rather than automatically activated protection tools.

From a structural perspective, time risks vary significantly across networks: FSOL is expected to regain full control of staked SOL within two days, but without absolute guarantees. Meanwhile, FETH (FETH.US) has no fixed timeline, as Ethereum validators must first exit the active set and undergo a waiting period, with network outages or high exit demand further prolonging this cycle.

Woofun AI compiled data shows Fidelity also lists backup options including credit support, borrowing digital assets, selling validator positions, and trading rights involving liquid staking tokens. As of August 21, neither trust has any credit facility, and some options face restrictions from legal, tax, or exchange rules.

In terms of fee allocation, the trusts must pay a staking fee of 15% of total revenue, retaining the remaining 85% for operating expenses, quarterly cash distributions, redemption requests, and further staking—yet the sponsor retains the right to alter this priority order. Ultimately, the trusts will make quarterly distributions in cash after realizing proceeds from sales. However, the specific amounts and timing of these distributions remain unguaranteed, requiring investors to fully recognize the reality of liquidity discounts and uncertainty inherent in the full-staking model.