Staking Should Not Be Classified as Securities, Crypto Group Argues

According to Foresight News, the Cryptocurrency Innovation Council of the Staking Benefits Alliance has urged the U.S. Securities and Exchange Commission (SEC) to refrain from classifying staking as securities. In a letter to the SEC's cryptocurrency task force, the organization highlighted that SEC staff recently stated that 'proof-of-work' cryptocurrency mining does not fall under the agency's jurisdiction as securities transactions. They argue that this logic should also apply to staking, removing it from the securities category. The group contends that when users stake their cryptocurrencies, they agree to lock them for a period to participate in the blockchain's operation and security, earning rewards in return. Those who stake crypto assets in 'proof-of-stake' blockchain protocols are providing 'valuable technical services,' and the resulting rewards should not be considered passive investment income.