Are Regulators Taking Aim at Crypto Staking? Rumors Suggest New SEC Scrutiny
A Twitter thread by Coinbase CEO Brian Armstrong has renewed fears that the Feds could clamp down on staking.
As U.S. regulators continue to tighten their reigns on crypto, rumors are swirling that the next target could be the practice of cryptocurrency staking.
“We’re hearing rumors that the SEC would like to get rid of crypto staking in the U.S. for retail customers,” Coinbase co-founder and CEO Brian Armstrong tweeted Wednesday. “I hope that’s not the case as I believe it would be a terrible path for the U.S. if that was allowed to happen.”
1/ We’re hearing rumors that the SEC would like to get rid of crypto staking in the U.S. for retail customers. I hope that’s not the case as I believe it would be a terrible path for the U.S. if that was allowed to happen.
Staking is the process by which users can deposit proof-of-stake tokens to a blockchain to help secure the network, with stakers receiving rewards for doing so.
After Armstrong’s tweet, at least one other crypto Twitter commentator claimed to have confirmed a multi-agency action against Coinbase. However, sources close to the matter told Decrypt that the claim was unsubstantiated. Paul Grewal, chief legal officer at Coinbase, said succinctly, “Totally false.”
Following the collapse of FTX in November 2022, the SEC has made cryptocurrency and digital assets a top priority of its examination division for 2023.
“The Division will conduct examinations of broker-dealers and RIAs that are using emerging financial technologies or employing new practices, including technological and online solutions to meet the demands of compliance and marketing and to service investor accounts,” the agency said.
Also on Wednesday, Bloomberg reported cryptocurrency exchange Kraken faces an SEC probe over claims of offering unregistered securities, citing a person with knowledge of
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