SEC clarifies stance on liquid staking activities

U.S Securities and Exchange Commission does not view certain liquid staking activities as the offer and sale of securities.

In a press release, the SEC says that liquid staking activities are not considered securities when applied in the sense of staking cryptocurrencies via protocols and receiving liquid tokens as receipts confirming ownership of the staked assets. 

SEC shared its guidance after a statement clarifying the view on liquid staking by the agency’s Division of Corporation Finance.

According to the regulator, applying this view to activities in the liquid staking market and within the regulatory purview of the Securities Act of 1933 or Securities Exchange Act of 1934, it is the guidance of the Commission’s Division of Corporation Finance that these activities do not constitute the offer and sale of securities.

SEC’s push for regulatory clarity

The statement on liquid staking is part of SEC’s fresh approach to crypto regulation, with this clarification aimed at providing further clarity to the industry. SEC chair Paul Atkins said the securities watchdog is committed to ensuring regulatory clarity regarding the application of U.S. federal securities laws in crypto and related financial activities.

“Today’s staff statement on liquid staking is a significant step forward in clarifying the staff’s view about crypto asset activities that do not fall within the SEC’s jurisdiction. I am pleased that the SEC’s Project Crypto initiative is already producing results for the American people,” the SEC chair added.

The regulator’s statement comes just days after leading industry players, including Jito Labs, VanEck, Bitwise Investments and MultiCoin Capital, urged SEC to allow use of liquid staking tokens in the anticipated Solana exchange-traded products.

It also comes a few weeks after the agency issued new listing standards and in-kind redemptions for crypto ETPs.