SEC Clarifies Liquid Staking Rules: No Securities Disclosures Required for Participants
The U.S. Securities and Exchange Commission (SEC) has issued fresh clarification on liquid staking, confirming that participants—including depositors and service providers—do not need to worry about securities law disclosures.
The statement, released Tuesday by the SEC’s Division of Corporation Finance, applies specifically to liquid staking arrangements in which users deposit “covered crypto assets” with a third-party provider. In exchange, depositors receive staking receipt tokens, which represent their locked assets while allowing continued liquidity in decentralized finance (DeFi) ecosystems.
Liquid staking enables token holders to participate in proof-of-stake blockchains without losing access to their capital. These derivative tokens can be traded, used in lending, or integrated into other DeFi strategies. According to DeFiLlama, total value locked (TVL) in liquid staking has reached nearly $67 billion, with Lido leading the market at $31.7 billion.
Following the SEC announcement, tokens tied to major liquid staking protocols such as Lido (LDO), Jito (JTO), and Rocket Pool (RPL) saw minor price increases, though prices remained lower overall for the day, CoinGecko data showed.
Not Binding Law, But a Clear Signal
Tuesday’s clarification mirrors an earlier SEC staff statement on other forms of staking. While the latest note is not formal rulemaking or binding Commissioner guidance, it provides insight into the SEC’s stance and signals reduced enforcement risk for participants following the outlined framework.
The guidance outlines the SEC’s position on liquid staking providers’ responsibilities, including roles in reward distribution, slashing events, and the issuance or redemption of staking receipt tokens.
Key Caveat: No Investment Contract
The SEC stressed one important condition: deposited crypto assets must not be part of or subject to an investment contract.
“In a liquid staking arrangement, the liquid staking provider (whether a node operator or not) does not provide entrepreneurial or managerial efforts to depositors,” the statement noted.
Similar to custodial staking models described in prior SEC guidance, liquid staking providers act as agents rather than decision-makers. “The liquid staking provider does not decide whether, when, or how much of a depositor’s covered crypto assets to stake,” the statement said.
This clarification provides much-needed transparency for the growing liquid staking market, potentially supporting further adoption by institutional players seeking regulatory clarity.
