SEC Confirms Liquid Staking Protocols Generally Not Securities Under U.S. Law
The SEC’s Division of Corporation Finance announced that properly structured liquid-staking protocols and their tokens generally do not qualify as securities under U.S. law. This decision has resulted in slight increases in token prices and protocol activity:
- Lido's governance token, LDO, increased by 4.5%, rising from $0.88 to $0.92.
- Rocket Pool's RPL token climbed 10.5%, reaching $7.28 from $6.59.
Total liquid-staking TVL is approximately $67 billion, with Lido holding a dominant share of $31.7 billion (47%). Inflows to staking protocols remained stable, showing no significant capital rotation despite the price movements.
Liquid staking tokens saw modest gains between 5% and 10%. The SEC's clarification has built baseline confidence in decentralized staking models, which were previously uncertain in regulatory terms.
Legal experts praised the SEC's ruling. Rebecca Rettig noted it was a collaborative effort and suggested possibilities for liquid staking tokens in ETFs. Lido's chief legal officer emphasized the benefits for stakers, allowing liquidity while retaining ownership of staked assets.
This regulatory clarity may attract institutional capital as competition for yield in DeFi intensifies.