The U.S. Securities and Exchange Commission (SEC) took a historic step in the cryptocurrency market by announcing that staking activities on proof-of-stake (PoS) based blockchain networks are not considered securities. This decision eliminates the requirement for platforms providing staking services and investors to register with the SEC. This development is seen as a significant deviation from the tendency during former SEC Chairman Gary Gensler's era to view staking as an investment contract (CCN.com, 2025).
In a statement from the SEC's Division of Corporate Finance, it was noted that staking activities are examined within the framework of the "Howey Test", and particularly for "collateralized crypto assets", these activities do not fall under the category of financial instruments (SEC.gov, 2025). The Howey Test is a four-pronged test used to determine whether a transaction qualifies as a security: an investment of money, a common enterprise, an expectation of profits, and profits coming from the efforts of others (FindLaw, n.d.). The SEC has stated that protocol staking activities are administrative or bureaucratic in nature, do not involve entrepreneurial or managerial efforts, and therefore do not meet the last element of the Howey Test (Bitcoin.com News, 2025).
SEC Commissioner Hester Peirce supported the decision, emphasizing that "Providing security is not a 'security'" and bringing clarity to the market (Cointelegraph, 2025). This step could open new doors for the sector by allowing crypto ETFs to offer products that include staking (CCN.com, 2025). However, Democratic SEC Commissioner Caroline Crenshaw criticized the decision, arguing that it paints an incomplete legal picture, downplays investor risks, and could increase regulatory uncertainty (Cointelegraph, 2025). According to Crenshaw, this decision is an example of the approach of "acting with the expectation of future changes while ignoring existing law" (Cointelegraph, 2025).
Conclusion: While the SEC's decision has the potential to reduce uncertainties in the crypto sector and promote innovation, discussions will continue to ensure that the regulatory framework is fully clarified and investor protection is provided.
