Participants in Liquid Staking, including depositors and providers, do not have to worry about securities laws, said the US Securities and Exchange Commission in a staff statement on Tuesday.
The statement, published by the Division of Corporation Finance, is specific to Liquid Stakeing, where participants deposit “covered crypto assets” in a third-party provider of stacking stacking stacking, which in turn gives receipt tokenes to the depositors.
Liquid Stoting allows users to unlock Tokens in Proof-of-Stake Blockchains while still maintaining access to their funds through derived tokens. These tokens can then be used for different defi activities. Currently, Liquid Stoting across all blockchains has nearly $ 67 billion in total value-lock (Tvl) with $ 31.7 billion in Lido, according to Defillama data.
The tokens tied to a series of floating poor protocols, including Lido, Jito and Rocket Pool, rose marginally after the SEC declaration was published, but is still down to today’s trade, CoingeCko showed.
To be sure, SEC had previously published another staff statement relating to other forms of efforts. Similar to the previous statement, Tuesday’s Note on Floating Stacking is not the same as binding guidance from the commissioners or regulations that have undergone SEC’s formal regulatory process.
However, the new statement signalizes how the agency thinks about the question and suggests that any crypto industrial participant who follows the guidance is not sued by the regulator.
Tuesday’s statement is specific to what Liquid Staking providers do, “Including their roles in the earnings and distribution of rewards, cuts and coins, issuing and redemption of the punching of receipt token,” as well as other affiliated services. The most important warning is that the deposited crypto assets cannot “part of or subject to an investment contract.”
“In a floating stack arrangement, the fluid poor supplier (whether a node operator or not) does not provide entrepreneurial or management efforts to depositors as it provides this service,” the statement states.
“These events are similar to those mentioned in the protocol’s statement with regard to ‘deposit arrangements’. The liquid provider of stack does not decide whether or how much of a depositor’s covered crypto assets to be taken and simply acts as an agent in inserting the covered crypto assets on the depot,” the statement states.
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