The publicly
traded and one of the biggest crypto exchanges in the ecosystem, Coinbase (NASDAQ:COIN),
has prepared an 18-page document titled the ‘Petition for Rulemaking’ which objective
is to convince US regulators, including the Securities and Exchange Commission
(SEC), that staking should not be put under the same regulatory framework as
securities.
Cryptocurrency
holders can receive rewards as an incentive by staking their cryptos with a
blockchain validator. These rewards typically come in the form of newly mined
cryptocurrencies. However, in exchange for these rewards, the holders lose
control over their original holdings until they decide to unstake them.
Staking is
a popular service among crypto exchange and digital assets providers. However,
it has recently come under closer scrutiny by regulators, including the SEC.
The US market watchdog claims that at least some of the staked tokens resemble
securities and should therefore be covered by the same rules. In the
institution’s view, offering staking without obtaining the relevant authorizations
and licenses breaches the US Securities Act.
Binance
disagrees with this statement and has proactively communicated on
cryptocurrency staking. The
petition focuses on showing how securities regulations treat proof-of-stake
services and explaining that they are essentially not the same as securities.
Coinbase’s publication
highlights the nuanced…
