On 5 August 2025, the United States Securities and Exchange Commission (US SEC) Division of Corporation Finance issued a staff statement addressing the legal status of “Liquid Staking” activities. The statement clarified that Liquid Staking Activities, when conducted within the defined framework, do not constitute the offer or sale of securities under the United States Securities Act of 1933 or the United States Securities Exchange Act of 1934. The US SEC’s position extends its prior guidance on protocol staking and provides detailed analysis of staking receipt tokens. According to the US SEC Division of Corporation Finance, registration obligations arise only where the deposited crypto assets or the staking receipt tokens are structured as investment contracts. While the statement does not carry binding legal effect, it establishes an authoritative interpretive stance on how United States securities laws apply to liquid staking.
Definitions
Crypto Assets: a “crypto asset” is an asset that is generated, issued, and/or transferred using a blockchain or similar distributed ledger technology network (“crypto network”), including, but not limited to, assets known as “tokens,” “digital assets,” “virtual currencies,” and “coins,” and that relies on cryptographic protocols
Liquid Staking: “Liquid Staking” as used in this statement refers to a type of Protocol Staking whereby owners of Covered Crypto Assets deposit their Covered Crypto Assets with a third-party Protocol Staking service provider (such owners, “Depositors”) and in return receive newly “minted” (or created) crypto assets (“Staking Receipt Tokens”) that evidence Depositors’ ownership of the deposited Covered Crypto Assets and any rewards (as described in the Protocol Staking Statement) that accrue to the deposited Covered Crypto Assets.
Staking Receipt Tokens, enable their holders to maintain liquidity without having to withdraw the deposited Covered Crypto Assets from staking.
Liquid Staking Providers: Persons can participate in such Liquid Staking through protocol-based or third-party service providers, both referred to in this statement as “Liquid Staking Providers.”
US SEC Division of Corporation Finance View on Liquid Staking Activities
“Liquid Staking Activities in connection with Protocol Staking do not involve the offer and sale of securities within the meaning of Section 2(a)(1) of the Securities Act of 1933 (the “Securities Act”) or Section 3(a)(10) of the Securities Exchange Act of 1934 (the “Exchange Act”).[11] Accordingly, it is the Division’s view that participants in Liquid Staking Activities do not need to register with the Commission transactions under the Securities Act, or fall within one of the Securities Act’s exemptions from registration in connection with these Liquid Staking Activities.”
The US SEC Division of Corporation Finance concluded that Liquid Staking Activities, as defined in the statement, are not securities transactions under the United States Securities Act of 1933 or the United States Securities Exchange Act of 1934. Applying the “investment contract” test from SEC v. W.J. Howey Co., 328 U.S. 293 (1946), the Division stated that liquid staking providers do not engage in entrepreneurial or managerial efforts that would satisfy the “efforts of others” prong. Custody arrangements, node operator selection, and redemption processes are administrative in nature and therefore insufficient to transform the activity into a securities transaction.
Treatment of Staking Receipt Tokens under United States Securities Laws
The US SEC Division of Corporation Finance further clarified that staking receipt tokens are not securities under Section 2(a)(1) of the United States Securities Act of 1933 or Section 3(a)(10) of the United States Securities Exchange Act of 1934. The tokens are classified as receipts evidencing ownership of deposited crypto assets, which are not themselves securities unless offered as part of an investment contract. Rewards accrue to the underlying assets, not the tokens, confirming that staking receipt tokens are evidentiary instruments rather than investment products.
Legal Analysis and Compliance Implications
The US SEC’s position takes upon a narrow interpretation of US securities law in relation to liquid staking. By distinguishing between entrepreneurial efforts and administrative functions, the Division limits the scope of the Howey test in this context. However, the analysis leaves open the possibility that activities extending beyond ministerial functions, such as providers guaranteeing rewards, exercising discretion over staking, or facilitating additional yield mechanisms, may fall within the definition of an investment contract.
For crypto exchanges, custodians, and protocol operators, this interpretive stance offers operational certainty, but it does not replace a fact-specific legal analysis. Global entities must ensure that their liquid staking models remain consistent with the framework described, particularly where they target United States participants.
This staff statement represents the views of the US SEC Division of Corporation Finance and does not constitute a rule, regulation, or formal Commission action. It aligns with previous interpretive statements on protocol staking and clarifies the treatment of liquid staking under the United States Securities Act of 1933 and the United States Securities Exchange Act of 1934. While informative, it does not create new obligations, and compliance must be determined through statutory analysis, case law precedent, and regulatory oversight.
(Source: https://www.sec.gov/newsroom/speeches-statements/corpfin-certain-liquid-staking-activities-080525)
