🔵 Cardano Founder: ADA Staking Is Not a Security, Despite New SEC Comments
Charles Hoskinson, the founder of Cardano and CEO of Input Output, has firmly asserted that staking ADA is not a security, pushing back against recent SEC guidance on liquid staking.
His statement comes in response to a press release from the SEC’s Division of Corporation Finance, which described liquid staking as using a service or protocol to stake crypto and receiving a token in return that represents the staked assets and anticipated rewards.
Cardano’s staking system, however, works differently. It’s part of the protocol’s core consensus mechanism, allowing ADA holders to delegate their tokens to staking pools and earn rewards—not by investing in a centralized entity, but by contributing to network security and transaction validation.
According to Hoskinson, Cardano’s staking model fails to meet the Howey Test, the legal benchmark used to determine whether something is a security. Delegating ADA doesn’t involve pooling funds into a common enterprise or expecting profits from someone else’s work—it’s a decentralized, protocol-level feature.
🔸 SEC’s “Project Crypto” Already Making Waves
The SEC’s recent staking clarification comes under the umbrella of Project Crypto, a new initiative designed to bring U.S. financial regulations into the on-chain era.
Just days after its launch, SEC Chairman Paul Atkins noted that the project is already delivering progress—highlighting the staking clarification as one early outcome. He emphasized the SEC’s commitment to providing clearer regulatory guidance around crypto and modern financial technologies.
