SEC Staff Clarifies: Staking on Proof-of-Stake Blockchains Not a Security

In a recent statement, staff from the U.S. Securities and Exchange Commission (SEC) clarified that certain staking activities on proof-of-stake (PoS) blockchains are not considered securities offerings under current regulations.

Released on May 29 by the SEC’s Division of Corporation Finance, the guidance states that “Protocol Staking Activities” — where users stake cryptocurrency to support network operations — do not require registration under the Securities Act and are not subject to exemptions either. According to the division, staking rewards are seen as payment for services rendered by node operators, rather than as profits derived from the efforts of third parties — a key component in defining a security under the Howey Test.

The staff also clarified that custodial staking — where custodians stake assets on behalf of clients — doesn’t qualify as a securities offering. They explained that custodians function more like agents, without discretionary control over the staking amounts or methods.

In addition, administrative actions such as slashing, early withdrawal penalties, and reward distribution methods were described as “ministerial” and not subject to securities law.

However, the statement made no mention of other staking formats like liquid staking or restaking. The SEC emphasized that the document is a staff view and does not carry formal legal weight.

The crypto industry has been pushing for greater regulatory clarity. At the Solana Accelerate conference held in New York earlier in May, industry participants renewed calls for the SEC to issue comprehensive guidance for Web3 service providers.

SEC Commissioner Hester Peirce welcomed the guidance, suggesting it brings clarity for those involved in staking. On the other hand, Commissioner Caroline Crenshaw expressed concerns that the approach may sidestep existing legal frameworks.