Grayscale, one of the largest crypto asset managers in the United States, is moving to stake over 40,000 Ethereum (ETH), according to fresh on-chain data from Arkham Intelligence.
This is a historic step for Grayscale as it becomes the first U.S. Ethereum ETF issuer to stake its holdings.
The move has sparked speculation across the crypto industry, with analysts suggesting that Grayscale may be preparing for a potential shift in the Securities and Exchange Commission’s (SEC) stance on staking and how it classifies such activities.
Earlier this year, the SEC delayed its decision on whether Grayscale funds could incorporate Ethereum staking.
Despite filing proposals to enable staking, Grayscale has yet to secure SEC approval.
However, the latest move suggests that Grayscale may be positioning ahead of an eventual ruling, especially given that no existing spot Ether ETFs currently offer staking options.
Here are 3 key things you need to know about the SEC regulatory development on staking.
1. SEC Liquid Staking Guidance Eases Regulatory Uncertainty
On August 5, the U.S. Securities and Exchange Commission’s Division of Corporation Finance issued a staff statement clarifying its view on liquid staking activities.
It held that, in many cases, liquid staking services, where users stake ETH (or other proof-of-stake assets) via a protocol or provider and receive staking receipt tokens, do not constitute securities under U.S. law, provided certain conditions are met.
The SEC executives made it clear that the receipt tokens (staking receipt tokens) are merely evidence of ownership of the underlying staked assets and rewards, not investment contracts.
As long as the liquid staking provider does not guarantee returns or exercise discretionary control over staking decisions.
Sam Kim, Chief Legal Officer of Lido Labs Foundation, added that the “SEC guidance confirming that liquid staking and receipt tokens like stETH do not constitute securities provides the much-needed guidance that Lido and the wider industry have needed.”
This guidance is important because it removes one major structural barrier for staking becoming more widely embraced by institutional actors.
2. Ethereum’s 45-Day Unstaking Queue: Security vs. User Experience
A growing concern among users and institutional stakeholders is the 45-day exit queue for unstaking ETH.
This delay means that when a validator or staker opts to exit, it takes up to 45 days for their ETH to be unlocked and returned.
Ethereum co-founder Vitalik Buterin recently defended this design, arguing that the long exit period is vital for network security.
He likens staking to a soldier’s duty; that is, if validators could exit suddenly or en masse, the chain would be more vulnerable.
The friction helps prevent coordinated attacks, sudden mass exits, and protects nodes that might be offline occasionally.
That said, he also acknowledged the design isn’t “optimal,” particularly from a UX (user experience) standpoint.
3. What This Means for US ETFs, Staking Activities & SEC Moves
Grayscale’s staking of 40,000+ ETH comes at a time when the SEC is showing signs of easing regulatory hurdles for staking and crypto ETPs (Exchange Traded Products).
On September 18, the regulatory body approved generic listing standards for commodity-based ETFs, which has added to the reasons for a possible SEC U-turn on staking.
Because fewer barriers to listing could encourage more staking or liquid staking exposure in ETF structures
Legal analyst Jason Gottlieb, a partner at Morrison Cohen, suggests that the SEC’s softer language on liquid staking may have more positive implications for general staking activities.
BlackRock has also met with the SEC’s Crypto Task Force to discuss the regulatory treatment of staking in crypto ETPs and the general ruling on tokenizing traditional securities.
According to a memo published by the SEC on May 9, BlackRock’s discussions were aimed at sharing perspectives on how staking could be enabled within regulated ETP structures.
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