SEC Clarifies Staking Regulations

The U.S. Securities and Exchange Commission (SEC) announced that under certain conditions, staking does not violate American securities laws.

The document prepared by the Division of Corporation Finance is not a legally binding guide but rather an analysis by the regulator.

Experts told CoinDesk that the statement effectively permits companies to offer staking services, including pools, custodial storage, and other related services. The SEC will not pursue individuals or companies involved in such activities.

According to the statement, operators of nodes, validators, custodians, delegates, nominators, and organizations engaged in staking their own and clients’ assets fall under the definition.

Lorien Gabel, CEO of Figment, noted that the main advantage of the document is the legalization of various activities that American companies might have previously feared.

“They included some auxiliary staking activities. For example, we provide slashing insurance and modified unbonding periods. According to [SEC representatives], this does not mean you are an asset manager as a staking provider,” he added.

Gabel pointed out that companies can now offer such services and even staking pools.

Alison Mangiero from the Crypto Council for Innovation views the Commission’s initiative as a gradual but important update from the regulator.

“This confirms that stakers will be treated the same as miners. I think this is especially important given that under [former SEC Chairman Gary] Gensler, there were many enforcement actions focused on staking as a service,” she said.

In her opinion, it is noteworthy that the statement appeared just days before the SEC’s deadline to review applications for including staking in spot Ethereum ETFs.

Gabel suggested that exchange-traded fund providers would likely have received approval for staking anyway, but the regulator’s statement will probably expedite this process.

A separate note clarifies that the document is highly specialized. It does not replace rulemaking by the commissioners and “has no legal force.”

Another note explains:

“This statement only addresses certain activities related to protected crypto assets that do not have inherent economic properties or rights, such as earning passive income or transferring rights to future income, profits, or assets of a business enterprise.”

Back in January, ConsenSys founder Joe Lubin noted that issuers of spot Ethereum ETFs in the U.S. were counting on “imminent” SEC approval of staking.