The U.S. Securities and Exchange Commission (SEC) has issued an official statement indicating that liquid staking and related tokens are not recognized as securities under current legislation. This decision means that projects issuing such tokens, as well as users who hold or trade liquid staking assets (LST), are not required to register these activities with the SEC.
This is reported by Finway
Justification and Market Reaction
The SEC emphasized in its statement that liquid staking does not fall under the definition of securities, and the recommendations are advisory in nature and not mandatory. Despite this, many industry experts have positively received the regulator’s new position, considering it crucial for the development of the DeFi market.
“Now institutions can confidently integrate LST into their products, which will undoubtedly attract new sources of revenue, expand the client base, and enable the creation of secondary markets for these assets.”
This was commented on by Alluvial CEO Mara Schmidt, highlighting the potential for attracting new clients and creating new markets.
Dynamics of Liquid Staking and SEC Criticism
As of August 2025, according to DeFiLlama data, the total value locked (TVL) in liquid staking protocols across various blockchain networks reached nearly 67 billion USD.
It is worth noting that the SEC had previously published similar recommendations regarding cryptocurrency staking. As in the previous case, the document is not legally binding, but it demonstrates the Commission’s overall vision for the industry.
Despite the positive reception from the market, some SEC members expressed disagreement with the new policy. In particular, Commissioner Caroline Crenshaw noted that the SEC’s leadership is based on unverified facts, contains legal assumptions, and may be difficult to apply in practice.