SEC Ruling Boosts Crypto Staking, Signals Bright Future for Proof-of-Stake Networks

June 5, 2025 – The U.S. Securities and Exchange Commission (SEC) has issued a landmark statement clarifying that staking activities on proof-of-stake (PoS) blockchain networks do not constitute securities transactions, providing long-awaited regulatory clarity for the cryptocurrency industry. The decision applies to a broad range of staking models, including solo staking, self-custodial, and custodial arrangements, and is expected to benefit major PoS ecosystems such as Ethereum, Solana, and Algorand.

The SEC’s Division of Corporation Finance stated that protocol staking activities—whereby crypto holders lock up tokens to support network operations and earn rewards—are not subject to registration under the Securities Act of 1933, as they do not involve the offer or sale of securities under Section 2(a)(1) of the act. This clarification covers activities by individual participants, third-party node operators, custodians, and other service providers, provided their roles are administrative or ministerial in nature.

Industry leaders have welcomed the ruling, highlighting its potential to drive innovation and adoption of staking services in the U.S. Notably, BlackRock has reportedly intensified its efforts to secure SEC approval for staking and tokenization features in Ethereum exchange-traded funds (ETFs), a move that could integrate yield-generating crypto assets into traditional finance and attract institutional investors. REX Shares has also filed a prospectus to launch Solana and Ethereum staking ETFs in the U.S., utilizing a unique corporate structure to bypass certain regulatory hurdles, with potential launches anticipated in the coming weeks.

Projects such as ChainGPT and other crypto stakeholders have celebrated the SEC’s decision, emphasizing its implications for expanding staking opportunities for U.S. users and companies. The ruling is expected to accelerate the growth of PoS networks, offering investors new avenues for passive income while reinforcing the legitimacy of decentralized finance in the U.S. market.

However, some SEC commissioners have cautioned that the statement does not alter existing law or court precedents regarding investment contracts and securities regulation. Commissioner Caroline Crenshaw noted that while the staff’s analysis reflects the evolving regulatory approach, it does not provide a definitive legal roadmap and leaves certain aspects of staking services open to interpretation. The statement also excludes staking services that make discretionary decisions about when and how much to stake on behalf of customers, which may still fall under securities law.

Despite these caveats, the SEC’s updated position marks a significant shift from previous regulatory stances and is widely seen as a positive development for the U.S. crypto industry. The clarification is expected to reduce regulatory risks, encourage greater participation in staking, and pave the way for further integration of digital assets into mainstream financial products.