Robbie Mitchnick isn’t buying all the scepticism around Ethereum.

It’s true: When the crypto market surged following the election of Donald Trump as president last November, Ether was the only major cryptocurrency not to hit an all-time high.

But Mitchnik, BlackRock’s head of digital assets, said concern surrounding the Ethereum blockchain has been “overdone.”

“There’s a lot to be optimistic about,” Mitchnick said Thursday at Blockworks’ Digital Asset Summit in New York.

“When you look at our experience, take BUIDL as an example, there was no question that the blockchain that we would start our tokenisation on would be Ethereum.”

Mitchnik was referring to BUIDL, a tokenised treasuries product on Ethereum that topped $1 billion in assets under management last week.

Tokenised offerings

It was a quiet win for the second most valuable blockchain network.

And to hear Mitchnik tell it, Ethereum could notch another win should US regulators approve staked exchange-traded-funds.

BlackRock’s influence shouldn’t be underestimated.

As the world’s largest investment firm with $10 trillion in assets, the New York-based firm changed crypto investing when it cannonballed into the pool last January.

That month, BlackRock, launched an exchange traded funds, or ETFs, for Bitcoin. In July, it launched its Ethereum ETF, ETHA.

The company’s Bitcoin ETF, with more than $51 billion net assets, helped usher in a new era for crypto investing.

And BlackRock CEO Larry Fink has been an avid booster of tokenisation, putting securities like stocks and bonds onchain.

Ethereum’s struggles

Yet Ethereum has been struggling in recent months.

The blockchain has been roiled by discontent among investors who bought its Ether cryptocurrency.

It has plunged further than Bitcoin amid a broader market slump triggered by Trump’s on-again, off-again tariff policies. Ether was recently trading under $2,000 for the first time since November 2023.

That has prompted soul–searching among prominent Ethereum developers and calls for restructuring at the Ethereum Foundation, a nonprofit run by the blockchain’s most prominent co-founder, Vitalik Buterin.

‘There’s a bit of a misconception out there that ETH ETFs have been meh.’

—  Robbie Mitchnick, BlackRock

BlackRock began its crypto experiment in 2020 with a private, company-run blockchain, according to Mitchnick.

“One of the very clear takeaways from that work was that public blockchains were actually where the future would be in this space. So we made a pretty decisive pivot,” he said.

“That decision appears to have been the right one.”

He also defended Ethereum ETFs, which have disappointed some investors in light of the record-setting debut of Bitcoin ETFs.

As of Thursday, Bitcoin ETFs were on track to record their first weekly gains since the beginning of February, according to analysts at JPMorgan.

Ethereum ETFs, meanwhile, had shed $84 million since Monday.

“There’s a bit of a misconception out there that ETH ETFs have been meh,” Mitchnick said.

He added that ETHA saw $6 billion in inflows in its first six months.

“The number of ETFs historically who have had more than that is a very short list,” he continued.

“But when you compare it to IBIT and the Bitcoin ETF complex generally, it doesn’t look that amazing. When you compare it to the actual ETF universe, it’s actually been incredibly successful.”

Adding staking

Nevertheless, Ether ETFs would benefit immensely from adding staking, Mitchnick said.

Staking is an Ethereum feature that allows users to lock up their tokens in return for a modest annual yield.

With the Ether backing ETHA and other ETFs sitting dormant, it could be staked to drive additional value to investors — if only regulators would let them.

In February, NYSE Arca filed a proposed rule change to allow the Grayscale Ethereum Trust and Ethereum Mini Trust — ETHE and EZET respectively — to stake their Ether holdings.

Industry advocates have pushed for staking in ETFs.

They argue that “including staking as a feature in certain ETPs will benefit investors, more accurately reflect the benefits of native network assets.

It would also permit issuers to support the security of the networks in which the assets operate, according to a memorandum submitted by Jito Labs and Multicoin Capital to the SEC Crypto Task Force.

“There’s obviously a next phase in the potential evolution of this,” Mitchnick said.

“There’s no question it’s less perfect for ETH today without staking. Staking yield is a meaningful part of how you can generate investment return in this space.”

Aleks Gilbert is DL News’ DeFi Correspondent based in New York. You can contact him at aleks@dlnews.com.