A coalition of nearly 30 leading crypto advocacy organizations is urging the U.S. SEC to provide clear and practical guidance on how staking and staking services should be regulated. In a letter sent on April 30 to SEC Commissioner Hester Peirce, the Crypto Council for Innovation’s Proof of Stake Alliance (POSA) insisted that staking is a technical mechanism—not an investment vehicle—and should be treated accordingly. Staking is Infrastructure, Not Investment, Say Advocates “Staking isn’t niche—it’s the backbone of the decentralized internet,” the letter read, emphasizing that staking plays a crucial role in securing blockchain networks and should not be misclassified under the Howey test, the standard the SEC uses to determine what constitutes a security. The group stressed that users who stake tokens maintain ownership of their assets, and that reward outcomes are determined by code, not by managerial effort. The letter comes in response to the SEC’s request for public comment on whether staking, including liquid staking, should be brought under the umbrella of federal securities law. The coalition’s message was clear: applying outdated financial disclosure frameworks to a deeply technical function could stall innovation in one of crypto’s most vital systems. SEC Should Avoid Freezing Innovation The POSA letter encouraged the SEC to take a more principles-based regulatory stance—similar to its previous handling of proof-of-work mining—rather than imposing rigid rules. The coalition argued that overregulation could freeze market structures and hinder the evolution of staking services, especially in exchange-traded products (ETPs), which could bring crypto further into mainstream finance. “In the past four months, we’ve seen more movement and constructive dialogue with the SEC than in the past four years,” the letter noted, signaling growing hope for more productive engagement between regulators and the crypto industry. The letter also pointed out that staking doesn’t generate profits through managerial oversight, unlike traditional companies. Instead, returns come from network participation, removing one of the key pillars of the Howey test definition of an investment contract. Heavyweights Back the Push for Clarity The push is backed by major names in the crypto space, including Consensys, Andreessen Horowitz (a16z), and Kraken—each of whom has a vested interest in how staking services are regulated in the U.S. Kraken, notably, resumed staking services in the country earlier this year despite a rocky regulatory backdrop. Meanwhile, anticipation continues to build for the approval of a crypto staking ETF . While the SEC recently delayed a decision on Grayscale’s Ether ETF, Bloomberg’s James Seyffart suggests a green light for staking-inclusive ETFs could come as early as May. The post Crypto Groups Push SEC for Staking Clarity Amid Regulatory Fog appeared first on TheCoinrise.com .
