The US Securities and Exchange Commission (SEC) has issued new guidelines by clarifying that common forms of crypto institution do not fall under securities laws.
On 29 May, the SEC Division of Corporation Finance confirmed that those who participated in expansion activities, including self-switching, delegated deployment, retention and non-indicator forms, are not obliged to register these actions with the financial regulator.
The financial supervisor stated:
“It is of the opinion that the division of the participants in deporting protocol does not have to register with the transactions under the Securities Act, or within one of the exemptions of the Securities Act of the registration in connection with these protocol reporting activities fall.”
The update also deals with the use of related services. According to the SEC, the provision of functions such as early recording options, bundled rewards, oblique protection or assets aggregation to meet minimal deployment thresholds, these schemes do not automatically classify as a supply of securities.
The agency emphasized that such improvements do not change the fundamental nature of bets under federal legislation.
Setting is an integral part of blockchain networks with a proof-of-stake () consensus mechanism, in which participants lock up their tokens to validate network transactions and earn rewards.
This process has generally proved controversial over the years, since the SEC, under former chairman Gary Genler, has pursued legal actions against companies participating in the activity.
SEC commissioners respond
SEC Commissioner Hester Peirce, an old advocate for a clearer crypto regulation, supported the decision. She described it as an essential part of proof-of-stake systems, where users contribute to network security by voluntarily locking their tokens.
Peirce emphasized that regulatory uncertainty has discouraged American users to deal with these networks, despite their interest in blockchain infrastructure.
She said:
“The declaration of the division applies to persons who themselves have covered certain covered crypto assets on a proof-of-stake or delegated proof-of-stake network.”
However, not everyone at the committee agreed. Commissioner Caroline Crenshaw criticized the interpretation of the staff and warned that it is striking from a legal precedent.
She argued that the Howey test, an important legal standard that was used to identify effects, was overlooked in the analysis.
Crenshaw added:
“This is another example of the constant ‘fake it’ of the SEC until we take the ‘approach to crypto – take action based on anticipation of future changes while the existing legislation is ignored.”
What does this mean for ETFs?
The position of the SEC could have important implications for Spot Ethereum exchange-bound funds, which are currently no longer to use their assets.
Nate Geraci, president of the ETF store, noted that this guidance takes away an important legal obstacle for funds that want to use Ethereum or other proof-of-stake assets.
However, Geraci pointed out that further clarity is still needed from the Internal Revenue Service (IRS), in particular about how setting up rewards will be treated within the Grantor Trust Structures that are usually used by ETFs.
If the preparation of integration in these ETFs is smooth, it could unlock a new income flow for investors and improve the attraction of crypto -investment products within regulated markets
In the meantime, ETFs have won ETFs regardless of Momentum, with nine consecutive days of inflow of a total of more than $ 480 million.