Key Points:
- The Crypto Council for Innovation (CCI) is urging the U.S. SEC to issue formal, binding guidance on cryptocurrency staking to resolve ongoing regulatory ambiguity.
- Under the previous administration, the SEC took enforcement actions against staking services as unregistered securities, but has since softened its stance, issuing guidance on memecoins and stablecoins.
- In February 2025, the SEC clarified that memecoins do not qualify as investment contracts; in April, it stated that payment-only stablecoins are not securities.
- Despite informal dialogues, no formal staking guidance or ETF approvals for staking products have been issued.
- The industry remains hopeful for Solana and other staking-enabled ETFs, even as the IRS classifies staking rewards as service income—a position the sector disputes.
- Concurrently, the “Genius Act” stablecoin bill in Congress aims to establish clear reserve and disclosure standards for stablecoin issuers.
- A newly formed SEC crypto task force under Commissioner Peirce promises faster, more transparent rule-making for digital assets.
Industry Appeal: Formalizing Staking Guidance
At Solana’s Accelerate conference in New York, Allison Muehr, head of staking policy for the Crypto Council for Innovation, emphasized that clarifying the SEC’s stance on staking has become “the industry’s top priority.” She noted that “we’re about 25% of the way there,” observing that “the SEC has done more constructive engagement with us in the past four months than in the last four years, but we still don’t have formal staking guidance”.
Muehr’s remarks underscore a fundamental tension: Web3 infrastructure providers—validators, node operators, and protocol developers—face unresolved legal questions about whether staking services constitute securities offerings under U.S. law. Without clear rules, projects hesitate to launch staking programs or integrate staking for user assets, fearing retroactive enforcement actions and investor lawsuits.
Regulatory Ambiguity and Its Impact
This regulatory uncertainty hampers both innovation and institutional adoption. Companies offering staking-as-a-service must determine compliance structures without knowing whether to register under the Securities Act of 1933 or the Investment Company Act of 1940. Many have delayed product rollouts or prevented U.S. customers from participating in staking to avoid potential SEC enforcement.
CCI’s outreach to the SEC—including multiple working-group meetings over recent months—reflects an industry-wide push for interpretive guidance or rule-making. Such guidance would ideally define permissible staking models, outline disclosure requirements, and specify custody and segregation rules for staked assets, thereby enabling firms to design compliant staking solutions and attract mainstream capital.
Enforcement Under Prior Administration
During the previous presidential administration, the SEC adopted a strict “regulation-by-enforcement” approach, bringing actions against several staking providers on the grounds that unregistered staking services effectively sold securities. Companies like BlockFi and Kraken faced subpoenas and enforcement settlements over staking and lending products claimed to be securities offerings.
This aggressive posture stemmed from the SEC’s reliance on the Howey test, which defines an investment contract—and therefore a security—as “an investment of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others.” Applying Howey to staking, the SEC argued that users who delegate assets to service providers were purchasing securities backed by others’ managerial efforts. However, these enforcement actions lacked a clear rule-making basis, fueling industry frustration and calls for formal rule-making to replace ad-hoc enforcement.
Memecoin Guidance: A First Step
In February 2025, the SEC’s Division of Corporation Finance issued a Staff Statement on memecoins—cryptocurrencies originating from internet memes or cultural phenomena—clarifying that “persons who participate in the offer and sale of meme coins” are not automatically subject to federal securities laws under certain circumstances . This statement represented the first time the SEC explicitly categorized an entire class of crypto assets as non-securities, provided they lack profit-sharing, dividend rights, or centralized managerial promises.
While not legally binding, the memecoin statement signaled a more flexible approach to crypto regulation, offering market participants at least partial clarity. Nonetheless, the SEC cautioned that each memecoin’s status depends on its unique facts and circumstances.
Stablecoin Clarification: Payments-Only Exemption
Building on the memecoin statement, in April 2025 the SEC clarified that stablecoins marketed solely as means of payment—not as vehicles for investment—are not securities. The guidance defined “covered stablecoins” as those redeemable one-for-one with U.S. dollars, backed by low-risk, liquid reserves, and not promoted for profit-generation.
Industry and legal commentators widely praised this move. According to a DLA Piper analysis, redeemable USD-linked stablecoins “do not need to register as securities transactions” if they meet the Division’s conditions, reducing legal risk for issuers like USDC and BUSD. However, questions remain about hybrid or algorithmic stablecoins, reserve-ratio disclosures, and cross-jurisdictional enforcement.
Congressional Action: The Genius Act
Meanwhile, in Congress legislators have advanced the “Genius Act,” aiming to codify stablecoin oversight at the federal level. Passed by procedural vote in late May 2025, the bill mandates issuers to maintain 1:1 reserves in cash or U.S. Treasurys, register with federal or state regulators, and adhere to capital, liquidity, and anti-money-laundering standards. The act also prohibits foreign issuers from offering stablecoins in the U.S. unless fully compliant with U.S. laws.
By establishing statutory requirements, the Genius Act seeks to eliminate regulatory gaps that currently lead issuers to navigate a patchwork of state money-transmitter laws and ambiguous SEC positions. If enacted, it would represent the most comprehensive U.S. stablecoin framework to date, offering a model other countries may emulate.
Staking Guidance: What’s Missing
Despite progress on memecoins and stablecoins, staking remains the lone major crypto activity without formal SEC guidance. Industry representatives have requested interpretive releases or even notice-and-comment rule-making to define when delegated staking services trigger securities registration. Key questions include:
- Custody vs. Delegation: Must staked assets be segregated in qualified custodial accounts?
- Profit Attribution: How to allocate network rewards between platform fees, operator margins, and user returns?
- Disclosure Standards: What risk factors—network slashing, protocol upgrades, validator downtime—must be disclosed?
Without answers, staking platforms risk enforcement actions akin to those seen under the previous administration, deterring U.S. retail and institutional participation in one of the fastest-growing DeFi sectors.
Prospects for Staking-Enabled ETFs
The industry is particularly eager for the SEC to authorize staking-enabled exchange-traded funds (ETFs). Such products would allow investors to gain exposure to crypto networks while automatically accruing staking rewards through the fund structure.
Muehr expressed optimism that, once the SEC “is comfortable with the structure,” staking ETFs—beginning with Solana (SOL)—could receive approval. “I’m hopeful we’ll see a Solana ETF and even a staked Solana ETF in the U.S. sometime soon,” she said, noting recent “productive meetings with the agency”. However, the SEC’s Division of Investment Management must issue clear guidance or approve a pilot program before such ETFs can launch without registration risk.
IRS Tax Treatment: A Point of Contention
Adding to the complexity, the Internal Revenue Service has officially classified staking rewards as “service income,” subject to ordinary income tax at the time of receipt. CCI and many industry players argue that this interpretation disincentivizes network participation and misunderstands the collaborative nature of staking.
“As service income, staking rewards face potentially punitive tax rates,” Muehr remarked. “We disagree with that interpretation and continue to engage” with the IRS to seek a more favorable tax framework, such as treating rewards as property appreciation or deferring recognition until sale. While no formal legislative remedy has emerged, several industry coalitions are exploring Congressional clarifications or IRS private-letter rulings to address the issue.
A New SEC Crypto Task Force
In March 2025, the SEC launched a dedicated crypto-focused task force under Commissioner Hester Peirce, tasked with “developing a clear regulatory framework” and expediting rule-making for digital assets. The task force’s mandate includes soliciting public input, drafting interpretive releases, and coordinating across SEC divisions to harmonize memecoin, stablecoin, and future staking guidance.
Industry advocates view this initiative as a positive sign: a structured process could replace the SEC’s prior reliance on enforcement actions and provide transparent timelines for guidance issuance. However, the task force has not yet announced a public schedule for staking-related releases, leaving market participants in limbo.
Conclusion
The crypto industry stands at a crossroads: after years of enforcement-driven ambiguity, the SEC has taken meaningful steps to delineate its approach to memecoins and stablecoins, and Congress may soon enshrine stablecoin standards in law. Yet, formal staking guidance—arguably the most technically complex and commercially significant issue—remains elusive.
With CCI’s vocal advocacy, the SEC’s new crypto task force, and legislative momentum from the Genius Act, the coming months could finally deliver clarity. Clear rules on staking would unlock institutional capital, enable innovative ETF products, and integrate staking as a mainstream financial service. At the same time, resolving IRS tax treatment and cross-agency coordination will be crucial to cementing the U.S. as a leader in Web3 infrastructure. As the industry engages regulators, the promise of a robust, compliant staking ecosystem inches closer to reality.
