Crypto Groups Urge SEC to Clarify That Staking Shouldn’t Be Regulated as a Security

A coalition of major crypto firms is calling on the U.S. Securities and Exchange Commission (SEC) to officially recognize that crypto staking should not be regulated under securities laws. The Crypto Council for Innovation and the Proof of Stake Alliance submitted a detailed letter supported by Consensys, Kraken, Ava Labs, Galaxy Digital, and others.

Their central claim: staking is a technical contribution to blockchain networks—not an investment scheme. When users stake tokens on proof-of-stake (PoS) blockchains, they actively help secure the network and are rewarded for their service, much like miners on proof-of-work networks.

The letter draws attention to the similarity with mining, urging the SEC to apply the same non-securities classification to staking. It argues that staking rewards are earned through work and should not be confused with passive income.

To promote responsible practices while avoiding securities regulation, the coalition proposes clear standards for staking providers:

• Emphasize technical operations, not returns
• Use correct terms like “staking rewards” (not “interest”)
• Ensure user ownership and access to staked assets
• Disclose fees and withdrawal timelines
• Avoid reward guarantees

The coalition stresses that unnecessary regulatory burdens could harm innovation and participation. It warns that overregulation may weaken PoS networks by reducing validator engagement and decentralization.

With other countries offering regulatory clarity around staking, industry leaders say the U.S. risks falling behind. They conclude: “Applying securities law to staking services would wrongly treat a technical process like a financial product, undermining blockchain ecosystem health.”