Yesterday, BlackRock launched ETHB, a staked Ethereum ETF and its third crypto fund to date.

Like its existing Ether ETF, it charges a 0.25% management fee. The difference is staking: ETHB puts its ETH to work, with BlackRock taking roughly 8% of rewards and Coinbase, its staking and custody partner, collecting 10%.

While BlackRock isn’t the first to bring a staked Ether ETF to the U.S. market, the market should pay attention. After all, the firm is controlling 59% of Bitcoin ETF assets and about 40% of Ethereum ETF assets in the U.S.

According to BlackRock’s Global Head of Digital Assets Robert Mitchnick, most of that latter market share will likely migrate into the staked version over time.

If Europe is any indication, he will be right. Over here, most investor demand for Ethereum ETPs already sits in staked products.

• RWA looping: the next growth engine for tokenized assets?

• Stablecoin-based neobank KAST raises $80m

RWA Looping: The Next Growth Engine for Tokenized Assets?

RWA Looping: Over the past weeks, leveraged yield strategies on tokenized real-world assets have emerged as one of the most discussed topics across institutional crypto. The catalyst: a growing number of asset managers, lending protocols, and infrastructure providers are building the rails to make it work.

• What it is: At its core, RWA looping is a leveraged yield strategy. An investor deposits a tokenized yield-bearing asset, such as a private credit fund or a tokenized treasury, as collateral on an onchain lending market, borrows stablecoins against it, and uses those stablecoins to acquire more of the same asset. By repeating this cycle, the investor multiplies their exposure to the underlying yield. A tokenized fund yielding 8% can produce north of 14% APY when looped three to four times.

Why it matters: Thanks to tokenization platforms like Securitize, the supply side of tokenized real-world assets is largely solved. Tier-one asset managers such as BlackRock, Franklin Templeton, and Apollo are willing to tokenize and bring products onchain. Now, the hard part is finding buyers that ignite the next stage of market growth.

A compelling case: RWA looping is increasingly considered one of the most credible paths to fuel that demand. It unlocks leveraged access to yield sources uncorrelated to crypto markets for onchain investors, while offering traditional investors something they rarely get: fast, accessible leverage on private credit, a trade that typically requires lengthy prime broker negotiations and remains reserved for the largest institutions.

Behind the scenes: To better understand the evolving infrastructure and use case landscape around RWA looping, Blockstories spoke with:

• Morpho, whose modular lending infrastructure serves as the backbone for many leveraged RWA strategies.

• RedStone, a leading oracle provider developing price feeds, rating, and liquidation systems tailored to tokenized RWAs.

• Gauntlet, one of crypto’s leading risk curators, overseeing leveraged RWA strategies with tens of millions of dollars in capital.

• 3F, a DeFi startup building infrastructure that allows investors to create leveraged RWA positions across a wide range of RWAs in one click.

• Fasanara Capital, a leading institutional asset manager overseeing more than $5 billion in assets and the tokenized private credit fund mF-ONE.

• Zharta, a loan infrastructure provider that recently announced, together with Securitize, the first onchain asynchronous redemption unwind for leveraged positions on tokenized securities.

Our condensed findings are presented below.

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1/ Why is RWA looping gaining traction now?

Two things changed in the past year that made this strategy viable.

First, onchain rates collapsed. As speculative activity faded and fewer participants sought leverage on crypto assets, the returns available from crypto-native lending strategies dropped, in some cases below traditional money market rates. That left a growing pool of onchain stablecoin capital searching for productive yield.

Second, RWA infrastructure matured: more tokenized assets now support the minting, redemption, and oracle integrations needed to function as collateral on lending markets like Morpho and Aave.

Once both pieces are in place, the math starts to work. With stablecoin borrow rates sitting around 3-4% and RWAs like tokenized private credit funds yielding 6-10%, the spread economics for looping become positive.

2/ What does the market for RWA looping look like today?

The market is still relatively small. Based on our conversations, leverage against RWAs across the main lending platforms such as Aave, Morpho, and Kamino is estimated to be around $700 million. For context, this would represent only a small share of the roughly $20 billion in outstanding loans across these lending markets.

On the asset side, most activity centers on leveraged strategies involving tokenized U.S. Treasuries and private credit funds from firms such as Apollo Global, FalconX, or Fasanara Capital.

On the demand side, the market remains largely crypto-native. First, there are DeFi-native hedge funds seeking leveraged exposure to real-world yield, as well as L1 foundations and DAO treasuries looking to diversify reserves with yield sources uncorrelated to their native tokens. A third, emerging driver is yield-bearing stablecoins that are beginning to explore RWAs as a way to add uncorrelated yield to their reserves and enhance returns for their holders.

3/ What’s still holding RWA looping back?

The core limitation is a mismatch between DeFi’s speed and the settlement reality of RWAs. While crypto-native lending markets assume that collateral can be priced, liquidated, and sold within seconds, most RWAs do not behave that way. Treasuries settle T+1. Private credit funds can have 90-day lock-ups or quarterly redemption windows. And most RWA tokens cannot be freely traded by arbitrary liquidators.

Another challenge is that most DeFi lending markets today rely on variable interest rates. Because looping strategies depend on the spread between the yield on the underlying asset and the cost of borrowing, any spike in borrow rates can compress or eliminate that margin entirely, making returns harder to predict and certain strategies unviable. This is also why a growing number of lending protocols are beginning to explore fixed-rate lending infrastructure.

Ultimately, no single protocol can solve all these problems on its own. Making RWA looping viable at scale requires coordination across many different infrastructure providers.

4/ If these challenges are solved, how could the RWA looping market evolve?

On the demand side, RWA looping could broaden participation from institutional investors by allowing them to increase exposure to assets they already hold in a more capital-efficient way.

On the supply side, the range of loopable assets is expected to widen, but not evenly. Duration risk is the defining constraint: the assets that scale first will be those that can settle quickly and have credible liquidation paths, not necessarily those with the highest yields.

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What’s the news?

On Monday, stablecoin-powered fintech KAST announced its $80 million Series A, valuing the 18-month-old startup at $600 million.

• About KAST: The platform provides users worldwide with access to USD bank accounts, global pay-ins and payouts across more than 190 countries, a crypto-powered credit card, and a growing suite of consumer and business financial tools built on stablecoin rails.

• Rapid growth: Since launching in summer 2024, the platform has scaled to more than one million users and now processes nearly $5 billion in annualized transaction volume. The company expects revenue to reach a $100 million annual run rate in 2026.

Behind the scenes: We spoke with Raagulan Pathy, founder and CEO of KAST, about what differentiates the platform from traditional neobanks and where the company is seeing the strongest growth across regions and use cases today.