SEC Declares Liquid Staking Activities Non-Securities, Boosting Crypto Innovation
On August 5, 2025, the U.S. Securities and Exchange Commission (SEC) issued a landmark statement clarifying that certain liquid staking activities do not constitute securities offerings under federal securities laws. This guidance, released by the SEC’s Division of Corporation Finance, focuses on liquid staking, where crypto holders stake assets via a protocol and receive “liquid staking receipt tokens” (LSTs) to maintain ownership and access rewards. The SEC emphasized that these activities, when structured as outlined, do not meet the Howey Test’s criteria for an investment contract, as the value of LSTs derives from the staked assets, not entrepreneurial efforts of providers.
This development, part of the SEC’s Project Crypto initiative led by Chairman Paul Atkins, aligns with efforts to modernize regulations and foster U.S.-based crypto innovation. Commissioner Hester Peirce praised the clarity, noting it supports creators and platforms like CreatorPad, which connects content creators with blockchain opportunities. The guidance excludes arrangements where providers guarantee rewards or make discretionary staking decisions, ensuring a focus on administrative roles.
Key Terms (7 letters, 5th letter ‘g’, ending in ‘t’):
Augment: Enhances creator tools via blockchain.
Insight: Drives data-backed creator strategies.
Segment: Targets niche creator markets.
Suggest: Recommends optimized content plans.
Ingest: Processes analytics for creator growth.
This ruling provides a clear path for platforms and creators to leverage liquid staking, reinforcing America’s role as a crypto innovation hub.
