The post Crypto Coalition Tells SEC Staking Is ‘Essential Good,’ Not a Security appeared on BitcoinEthereumNews.com.

The Crypto Council for Innovation is making a case with the U.S. Securities and Exchange Commission that staking is not only a virtue for digital asset markets, but it should be hands-off for the securities regulator. The group — a coalition of staking interests, including Kraken, a16z, Lido, Galaxy, Figment, Polychain and Paradigm — argued in a letter to the agency’s crypto task force that the logic behind the SEC staff’s recent statement that “proof-of-work” crypto mining isn’t a securities transaction under the agency’s jurisdiction, should extend to the practice of staking, pulling it out of the securities bucket. “Stakers, like PoW miners, are compensated based on protocol-defined outcomes, not managerial actions or profit-sharing arrangements,” according to the letter reviewed by CoinDesk. When users stake their coins, they agree to have them locked up for a certain period of time to participate in the operation and security of a blockchain, and they earn a return for that. Those who stake their crypto assets on “proof-of-stake” blockchain protocols are providing “valuable technical services,” and the resulting rewards aren’t passive investment gains, the group contends. Read More: Crypto Staking 101: What Is Staking? The CCI view runs counter to the SEC’s previous stance, when former Chairman Gary Gensler’s enforcement staff targeted crypto staking operations, such as in Kraken’s high-profile settlement with the agency as well as other cases, including one involving Consensys. The SEC also blocked staking in exchange-traded funds (ETFs) tracking Ethereum (ETH) as it reviewed applications for those products in 2024. The CCI letter asked the SEC to provide guidance much like it’s done for memecoin issuers, the miners and for some stablecoin issuers, declaring that their activities fall outside the agency’s legal concern. While those statements aren’t binding — not even as formal guidance — they’re meant as markers…

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Filed under: News - @ April 30, 2025 7:27 pm