SEC Holds Closed-Door Meeting with Financial Giants: ETF Settlement Model and Pledge Redemption Mechanism Become Key Discussion Points
This week, the regulatory dynamics of cryptocurrency by the U.S. Securities and Exchange Commission (SEC) have been dramatic. First, an in-depth discussion was held with global asset management giant BlackRock, followed by a closed-door meeting with top institutions in the crypto space such as a16z, Paradigm, and Consensys. These two key meetings are expected to have a decisive impact on the regulatory framework for cryptocurrency ETPs and the direction of staking.
During this meeting, BlackRock's core team expressed a preference for the “cash settlement” model for ETFs and proposed an innovative plan for physical redemption. This plan allows investors to directly exchange fund shares and redeem physical assets using cryptocurrencies like Bitcoin and Ethereum in the future, bypassing the cumbersome dollar settlement steps.
If this plan can be implemented, it will undoubtedly bring significant liquidity to the market, effectively giving the traditional financial ETF framework a complete overhaul with the flesh and blood of crypto assets.
In addition to the ETF upgrade topic, an alliance composed of institutions such as a16z and Consensys is fervently presenting their advantages regarding staking to the SEC.
They detailed three models: liquid staking, custodial staking, and delegated non-custodial staking, even breaking down the operation manual for “staking as a service” on site, striving to demonstrate the enormous profit potential of staking to regulators.
They almost placed the annualized yield chart for Ethereum staking directly in front of the SEC, strongly urging the regulatory body: “Look, how enticing this return is; it’s a missed opportunity if you don’t earn it!”
In fact, the SEC has already faced two “sieges” from the crypto space this year. As early as February, Jito Labs and Multicoin Capital proposed the holding staking and automatic yield generation scheme, aiming to transform ETFs into profit-generating tools, showcasing the crypto industry's urgent desire for reform.
It’s worth noting that ETH staking alone can generate tens of billions of dollars in annual returns, not to mention the looming presence of newcomers like Solana, Cardano, and Ripple.
Therefore, the current focus of the market is whether the SEC will greenlight these proposals or continue to block the advancement of this wave of innovation under the guise of “investor protection.”
Do you think physical redemption and ETF staking functions will successfully pass the SEC this year?